Post on 23-Mar-2020
22nd
Annual European Real Estate Society Conference
ERES 2015 Istanbul
Book of Abstracts
Editor
Kerem Yavuz ARSLANLI
24–27 June 2015 Istanbul, Turkey
Organised by
Istanbul Technical University
Faculty of Architecture | Urban and Enviromental Planning and Researh Center | Real
Estate Development Masters Programme
Taşkışla | Istanbul | 2015
ERES
European Real Estate Society
ITU
Urban and Environmental Planning and Research Center
ISBN 978-975-561-464-9
© For all authors in the proceedings
All rights reserved. Any views or opinions expressed in any of the papers in this collection
are those of their respective authors. They do not represent the view or opinions of the
Istanbul Technical University, the editor and reviewers, nor of the publisher and conference
sponsors.
Any products or services that are referred to in this book may be either trademarks and/or
registered trademarks of their respective owners. The publisher, editor and authors make no
claim to those trademarks.
Editor
Kerem Yavuz ARSLANLI
Cover Image
Nur ESİN
Graphic Design
A. Buket ÖNEM
Published by
2015 Urban and Environmental Planning and Research Center, ITU
CIP
ERES Conference (22nd
:2015 :Istanbul, Turkey)
İstanbul : İ.T.Ü.,2015.
ISBN 978-975-561-464-9)
Printed in Turkey by Cenkler, Istanbul, Turkey
İİİ
Preface
Dear Delegates at ERES 2015 Istanbul,
It’s a pleasure for us to present you with this Book of Abstracts, consisting of
contributions accepted for publication at the 22nd ERES Conference in Istanbul.
The ERES 2015 Istanbul call for abstracts resulted to a 281 promising
submissions of 424 authors from 41 countries. The theme distribution of papers
are; Tax and Legal Issues in Real Estate %2, Marketing & Communication in Real
Estate %2, PPF, PPP & Infrastructures %2, Asset, Property & Facility Management
%3, Real Estate Education %3, Performance and Risk Management %3, Real
Estate Portfolio Management %4, Corporate Real Estate %5, Real Estate
Development %5, International Real Estate %6 Real Estate Finance & Investment
%7, Real Estate Valuation %7, Market Research Analysis & Forecasting %11, Real
Estate & Regional and Urban Economics %13, Green Buildings & Environmental
Policies %13, Housing Markets & Economics %19.
The conference committed a broad range of topics pertaining to global real estate
issues and a diverse audience comprising of academics and practitioners from
Europe and around the World. Istanbul also provided a wonderful venue for the
conference themes with its massive expansion and transformation processes
throughout its history to explore different aspects of real estate not only for Istanbul
but also across the World.
I would like to honor the support of A. Buket Önem, acting as the Conference
Secretariat & preparing the book of abstracts for publication. I would like to thank
to the Local Organizing Committee (Ferhan Gezici, Hayriye Eşbah Tuncay,
Zeynep Erdoğan, Dilek Pekdemir) from Humanitas Tour; Hakkı Pehlivan, Dilek
Dingeç and Duygu Oğuzman for helping on registrations and logistics. I would
like to thank to Nur Esin for her magnificent “Istanbul” painting series, crafted only
for ERES 2015 Conference. I would like to express my deep appreciation to
Neşecan Çekici and Murat Berberoğlu for their supports and all our conference
sponsors for their generous contributions.
Kerem Yavuz Arslanlı, PhD
Conference Chair
V
Welcome from Ramón Sotelo, IRES President
Dear ERES 2015 Delegates,
As President of the International Real Estate Society, it is my pleasure to welcome
you to the 22nd European Real Estate Society Annual Conference in Istanbul.
IRES is an umbrella association committed to encouraging real estate research
and education on a global basis, providing means for enhancing the
interconnectivity among all the sisters’ societies: the American Real Estate
Society, the European Real Estate Society, the Pacific Rim Real Estate Society,
the Asian Real Estate Society, the African Real Estate Society, the Latin American
Real Estate Society and the Middle East North Africa Real Estate Society.
This is our first annual conference from ERES in Turkey. Before, a very successful
industry seminar took place in 2010 in Istanbul, too. We are proud so observe,
Istanbul follows the European tradition to heavily include the industry into the
academic conference – not only as sponsors, but also with participants on
distinguished panels.
I would like to extend an invitation to attend the two IRES Panels during the
conference. One, chaired by our incoming president, David Parker, included in
the MENARES session and the other branded “Mind the gap – Academics and
Practitioners in Real Estate” to discuss the relationship between the industry and
the university. It is a honor for me to chair this panel.
As a member of a sister society you are a member of the IRES as well, and we
appreciate your participation in our activities, sharing your ideas and helping IRES
mission. IRES last year celebrated it´s 20th anniversary. You find a 20th
anniversary monograph edited by our past president Sandy Bond on our website.
Enjoy the conference and the fascination city of Istanbul.
Ramón Sotelo
President, International Real Estate Society
Bauhaus-University Weimar
Vİİ
Organisation
ERES 2015 Local Organising Committee
Kerem Yavuz Arslanlı – Istanbul Technical University
Conference Chair
Dilek Pekdemir –Cushman&Wakefield
Vice Conference Chair
Hayriye Eşbah Tuncay - Istanbul Technical University
Ferhan Gezici Korten - Istanbul Technical University
A. Buket Önem - Istanbul Technical University
ERES 2015 Track Chairs (Peer Reviewed Papers)
Rianne Appel-Meulenbroek - Eindhoven University of Technology
Track: Corporate Real Estate Management
Martin Hoesli - University of Geneva
Track: Finance & Investment
Paloma Taltavull de La Paz - University of Alicante
Track: Housing Markets & Economics
ERES 2015 Doctoral Session Organizers
Ignas Gostautas, PhD Network Chair - Nottingham Trent University
Jan Reinert, PhD Network Vice Chair - IPD Germany
Rachel Kelly, PhD Network Vice Chair - University of Ulster
ERES 2015 Scientific Committee
Ion Anghel -Bucharest University of Economics
Kerem Yavuz Arslanlı - Istanbul Technical University
Stanislaw Belniak - Cracow University of Economics
Jim Berry - University of Ulster
Eamonn D’Arcy - University of Reading
Neil Dunse - Heriot Watt University
Clare Eriksson - RICS London
Wolfgang Feilmayr - Vienna University of Technology
Marc Francke - University of Amsterdam
Nick French - Oxford Brookes University
Claudio Giannotti - University Lum of Casamassima (Bari)
Martin Hoesli - Universities of Geneva and Aberdeen
Fraser Hughes – EPRA
Ingrid Janssen - Eindhoven University of Technology
Veronika Lang - Austrian Standards
Stephen Lee - Cass Business School, City University
Andreas Loepfe - CUREM, University of Zurich
Gunther Maier - Vienna University of Economics
Bob Martens - Vienna University of Technology
Stanley McGreal - University of Ulster
Eliane Monetti - University of Sao Paulo
viii
Giacomo Morri -SDA Bocconi
Ferhan Gezici Korten - Istanbul Technical University
Ingrid Nappi-Choulet - ESSEC School of Management
Akin Olawore - Akin Olawore & co
Dilek Pekdemir – Cushman&Wakefield
Andreas Schiller - SPH Schiller Publishing House
Ramon Sotelo – Bauhaus - Universität Weimar
Paloma Taltavull - University of Alicante
Matthias Thomas – INREV
Giovanni Tira -University of Reading
Kristin Wellner – Technical University Berlin
Michael White - Nottingham Trent University
Abdullah Yavaş - Wisconsin School of Business
Yıldıray Yıldırım - Syracuse University
Local Scientific Committee
Elif Alkay - Istanbul Technical University
Gülay Başarır - Mimar Sinan University
Şebnem Burnaz - Istanbul Technical University
Murat Çıracı - Istanbul Technical University
Vedia Dökmeci - Istanbul Technical University
Işıl Erol - Ozyegin University
Nur Esin - Okan University
Christopher Hannum - Istanbul Technical University
Ali Hepşen - Istanbul University
Fatma Heyecan Giritli - Istanbul Technical University
Zeynep Önder - Bilkent University
Özlem Özçevik - Istanbul Technical University
Evren Özus - Ata Real Estate
Sinan Mert Şener - Istanbul Technical University
Şevkiye Şence Türk - Istanbul Technical University
Elçin Taş - Istanbul Technical University
Doğan Tırtıroğlu - Kadir Has University
Funda Yirmibeşoğlu - Istanbul Technical University
Industry Scientific Committee
Şenay Azak-Matt - Aareal Bank
Ersun Bayraktaroğlu - PwC Türkiye
Yener Coşkun – Capital Markets of Turkey
M. Emre Çamlıbel- Soyak
Neşecan Çekici - EPOS Property Consulting
Firuz Soyuer - DTZ Pamir & Soyuer
Haluk Sur - Cushman&Wakefield
Mete Varas - REIDIN
İX
Table of Contents
Preface ____________________________________________________________ iii
Welcome from Ramón Sotelo, IRES President ____________________________ v
A-5 Asset, Property&Facility Management
Mohsen Shojaee Far, Ioanna Alsasua Pastrana, Carlos Marmolejo Duarte ____ 1
Building Information Electronic Modeling (BIM) Process as an Instrumental Tool for Real Estate
Integrated Economic Evaluations
Kaia Kask __________________________________________________________ 2
Conceptual Framework for Measurement of Asset Depreciation on Buildings
Hilde Remøy, Hans De Jonge _________________________________________ 3
Good Buildings Drive out Bad Buildings? Defining the Dogs and the Stars
Carsten Lausberg, Franziska Piepke ___________________________________ 4 Improving the Purchase Decision in Real Estate Asset Management by Debiasing Decision-makers
A-6 Asset, Property&Facility Management
Leva Kvedaraviciene _________________________________________________ 5
Major Drivers of Baltic Shopping Centres’ Market
Hilde Remøy, Sara Wilkinson _________________________________________ 6
Adaptive Reuse of Offices: Residential Conversions in Sydney
Kaia Kask _________________________________________________________ 7
Implications from Fiscal Impact Analysis of Public Sector Real Estate Asset Management Models
B-1 Corporate Real Estate
Howard Cooke, Rianne Appel Meulenbroek ______________________________ 8
Impact of Corporate Real Estate on UK Business
Thijs Ploumen, Rianne Appel- Meulenbroek, Jos Smeets ___________________ 9
How to Align the Organization of the CREM-department to Strategy during a Recession
Riikka Kyrö, Antti Peltokorpi, Karlos Artto _______________________________ 10
Health and Wellbeing Sector Actors Embrace Collaboration and even Competition On-campus
Theo Van der Voordt ________________________________________________ 11
Adding Value by Corporate Real Estate: Parameters and Applications
B-2 Corporate Real Estate
Danielle Claire Sanderson ___________________________________________ 12
Determinants of Satisfaction amongst Occupiers of Commercial Property
Kevin Meyer, Andreas Pfnür, Maria Braunschweig ______________________ 13
PPP as an Alternative Procurement Method for Corporates
X
Gheorghe Petru Multescu, Barry Symonds _____________________________ 14
Alignment of Corporate Real Estate and Business Strategy in a disrupted market: hold and manage
or sell?
B-3 Corporate Real Estate
Ana Chadburn, Judy Smith __________________________________________ 15
The Productive Workplace for Knowledge Workers: A Focus on Workplace Design and Environment
Across Various Age Groups
Karim Rochdi _____________________________________________________ 16
Ownership in Real Estate and Stock Market Performance: Evidence from German Equities
Markus Surmann, Wolfgang A. Brunauer, Sven Bienert ___________________ 17
The Energy Efficiency of Corporate Real Estate Assets: The Role of Professional Management for
Corporate Environmental Performance
Pieter Le Roux ____________________________________________________ 18
What is the Real Added Value of Sustainable Office Buildings? - Initiating a Longitudinal Study
C-1 Green Building & Enviromental Policies
Erdal Aydın, Dirk Brounen, Nils Kok __________________________________ 19
Capitalization of Residential Energy Efficiency
Lawrence Chin _____________________________________________________ 20
Sustainability in Retail Developments: Case of Singapore
Stephan Kippes ____________________________________________________ 21
The Attitudes of Buyers, Vendors, Tenants, and Landlords Concerning Environmental Questions - an
Analysis based on Different National Empirical Surveys
Marcelo Cajias, Franz Fürst, Sven Bienert ______________________________ 22
Is Energy Efficiency Priced in the Housing Market? - Large Sample Evidence from Germany
C-2 Green Building & Enviromental Policies
Fong-Yao Chen, Jen-Hsu Liang ______________________________________ 23
The Price Effect of EEWH Certification
Franz Fuerst, Pat McAllister, Anupam Nanda, Peter Wyatt ________________ 24
Energy Performance Ratings and House Prices in Wales: An Empirical Study
Gunther Maier, Sabine Sedlacek, Philipp Kaufmann _____________________ 25
From Green Buildings to a Sustainable Real Estate Industry - Assessing Five Years of ÖGNI
Chiara D'Alpaos, Michele Moretto _____________________________________ 26
Do Smart Grids Increase Real Estate Market Values?
C-3 Green Building & Enviromental Policies
Pietro Bonifaci, Sergio Copiello ______________________________________ 27
A Multi Actor Multi Criteria Approach to Evaluate the Effectiveness of European Policies on Buildings
Energy Retrofit. The Italian Context
Xİ
Sotirios Thanos, Maria Karmagianni, Ian Hamilton _______________________ 28
Domestic Energy Prepayment and Fuel Poverty: Induced Self-selection of Housing Characteristics
Influencing the Welfare of Fuel-poor Households
Nikolas D. Müller, Andreas Pfnür _____________________________________ 29
Efficient measures for energetic retrofit–an interdisciplinary case study of representative housings in
Germany
Megat Mohd Ghazali Megat Abdul Rahman_____________________________ 30
Measuring Instrument Constructs for Green Office Building Investments Variables Using Rasch
Measurement Model
C-4 Green Building & Enviromental Policies
Saul Nurick, Alexandra Morris, Jody Schofield __________________________ 31
An Investigation into the Strategic Importance of GBFIs within the Listed Property Market
Michael McCord, John McCord, Peadar Davis, Martin Haran ______________ 32
Is Energy Performance too Taxing?
Megat Mohd Ghazali Megat Abdul Rahman, Maryanti Mohd Raid , Asmma' Che
Kasim, Khadijah Hussin _____________________________________________ 33
Impact of Indoor Environmental Quality and Innovation Features on Residential Property Price and
Rent in Malaysia: a Review
Costin Ciora, Gunther Maier, Ion Anghel________________________________ 34
Location, Location, Green. A spatial analysis of green buildings in Europe?
C-5 Green Building & Enviromental Policies
Sergio Copiello, Pietro Bonifaci ______________________________________ 35
Public-Private Partnership, Buildings Energy Efficiency and Social Housing: Renewed Tools to Satisfy
Emerging Needs. Empirical Findings from a Comparative Analysis of Italian Experiences
Rogerio Santovito, Alex Abiko, Sven Bienert _____________________________ 36
Discrepancies on Comunity-level GHG Emissions Inventories
Nelufer Ansari, Marcelo Cajias, Sven Bienert ____________________________ 37
The Value Contribution of Sustainability Reporting - an Empirical Evidence for Real Estate
Companies
Brian (Tony) Ciochetti, Mehmet Emre Çamlıbel __________________________ 38
An Integrated Optimization Model for Capital Allocation of Energy Efficiency Measures of Existing
Buildings: A Case Study of Bogazici University Kilyos Campus
C-6 Green Building & Enviromental Policies
Peter de Jong _____________________________________________________ 39
Longevity of Buildings as an Economic KPI
Valentina Antoniucci, Chiara D'Alpaos, Giuliano Marella ___________________ 40
How Regulation Affects Innovation: The Smart Grid Case at Urban Scale
Sandra Vieira Gomes, Teresa Florentino _______________________________ 41
The Role of Urban Parks in Cities’ Quality of Life
Philippe Bélanger __________________________________________________ 42
Fundamental Value of Distributed Photovoltaic Energy Production around the World
Xİİ
D-1 Housing Markets & Economics
Philipp Deschermeier _______________________________________________ 43
The Consequences of the Demographic Change on the Demand for Personal Living Space in
Germany
Stephanie Moulton, Donald Haurin, Wei Shi, Mike Ericksen ________________ 44
Who Gets a Reverse Mortgage? Identifying Household Level Determinants of U.S. Reverse Mortgage
Choices
Lyndall Bryant _____________________________________________________ 45
Developer Charges and Housing Affordabilty in Brisbane, Australia
Clare Branigan, Paul Ryan ___________________________________________ 46
Behavioural Biases in the Acquisition of Multiple Properties by Owner Occupier Investors during the
Irish Residential Real Estate Bubble
D-3 Housing Markets & Economics
Annelies Hoebeeck, Carine Smolders _________________________________ 47
The Impact of the Mortgage Interest and Capital Deduction on Belgian Borrowing Behavior
Costin Ciora, Ion Anghel, Gunther Maier________________________________ 48
Housing Price Indexes in Central and Eastern Europe. A Comparative Study on the Models
Tanja Tyvimaa, Karen Gibler, Velma Zahirovic-Herbert ____________________ 49
The Effect of Age-Restricted Housing on Surrounding House Prices
Deborah Levy, Richard Dunning, Craig Watkins _________________________ 50
New Behavioural Business Practices: Agent Interactions in the Housing Market
D-4 Housing Markets & Economics
Sinem Guler, Kangalli Uyar, Nihal Yayla, Bülent Güloğlu __________________ 51
Estimation of Hedonic House Pricing Model through Non-Parametric Methods: Istanbul Real Estate
Market
Stephanie Heitel, Andreas Pfnür ______________________________________ 52
Multiple Interests as Management Challenge for German Housing Companies: How Diverse and
Conflicting are their Stakeholders’ Expectations?
Peter Parlasca, Bogdan Marola _______________________________________ 53
House Prices in Europe – Indicator Development and Figures
Yasmine Essafi, Arnaud Simon _______________________________________ 54
Housing Market and Demography, Evidence from French Panel Data
D-5 Housing Markets & Economics
Simon Stevenson, James Young _____________________________________ 55
How do Optimal Reserves Compare to Actual Undisclosed Reserve Prices? Empirical Evidence from
English Open Outcry Auctions of Residential Property
Xİİİ
Brano Glumac, Thomas, P. Wissink ___________________________________ 56
Homebuyers’ Preference for Installed PV Systems – Discrete Choice Experiment
Daniel Y. F. Lo, Nan Liu _____________________________________________ 57
Information Transparency and Pricing Strategy in the Scottish Housing Market – an Evaluation of the
Home Report Scheme
Paloma Taltavull de La Paz, Francisco Juárez __________________________ 58
Long Term House Price Series for Spain: Construction and International Comparison
D-6 Housing Markets & Economics
Ing. Jan Veuger ___________________________________________________ 59
Housing Association Objectives need to be under the Same Roof: Report
Erwin Van der Krabben, Joep Arts _____________________________________ 60
Synergy Effects of Collaboration by Housing Corporations and Institutional Investors on the Dutch
Housing Market
Frans Schilder, Edwin Buitelaar _______________________________________ 61
The Economics of Style
Angelika Kallakmaa_________________________________________________ 62
What to Expect from the Housing Market in 2015
D-7 Housing Markets & Economics
Danielle Barentsen, Philip Koppels, Hilde Remøy ________________________ 63
Heritage Designation and House Prices
Darius Kulikauskas _________________________________________________ 64
Measuring Fundamental Housing Prices in the Baltic States: Empirical Approach
Dimitra Kavarnou, Anupam Nanda ____________________________________ 65
Is the Housing Market of the most Tourism Penetrated Places Affected by Tourism Penetration? –
The Case Study of Crete Island
Mehmet Emre Çamlıbel, Gülcemal Alhanlıoğlu, Deniz Uğurlu ______________ 66
Structural Models of Urban Regeneration in Emerging Markets-Turkey Case
D-8 Housing Markets & Economics
Christopher Hannum, Kerem Yavuz Arslanlı _____________________________ 67
A Measure of Spatial Competition in Residential Brokerage
Ingrid Janssen, Roger Bougie, Koen Pillen _____________________________ 68
The Effect of Different Pricing Strategies in the Dutch Housing Market
Diego Salzman ____________________________________________________ 69
London Town a Behavioural Approach to Property Prices in the Capital City
Mohd Azhar Ab Wahid ______________________________________________ 70
Generation Y Homeownership in Malaysia
XİV
E-1 International Real Estate
Puying Li, Simon Huston ____________________________________________ 71
International Competitiveness of China’s Construction Firms
Francois Viruly _____________________________________________________ 72
An Assessment of the Viability of Large Mixed-Use Real Estate Developments in Sub–Saharan Africa
Kristian Kahre, Ene Kolbre ___________________________________________ 73
Housing Affordability Changes in Baltic Capitals: On the Effect of Housing Boom and Negative
Housing Equity on Housing Affordability
E-2 International Real Estate
Eamonn D'Arcy, Stephen Roulac ______________________________________ 74
Global Brands the New Global Badge of Real Estate Service Quality?
Colin Lizieri, Daniel Mekic ____________________________________________ 75
Real Estate and Global Capital Networks: Drilling into the City of London
Rene-Ojas Woltering ________________________________________________ 76
The Effect of Interest Rates Changes on Listed Real Estate Companies
E-3 International Real Estate
William Dimovski ___________________________________________________ 77
The Direct Costs of A-REIT IPOs
Vivek Sah, Alan Tidwell ______________________________________________ 78
Are REITs more Transparent than Stock: Evidence Using a Propensity Score Model
Ayosha Orth _______________________________________________________ 79
Strategic Relevance of Due Diligence Real Estate – An Integrated Transaction Cost Theory Approach
E-4 International Real Estate
Guowei Gu _______________________________________________________ 80
Examining the Time of Housing Supply
Sofia Dermisi ______________________________________________________ 81
Global Comparative Effects of Civil Unrests on Hotel Performance
Nicola Livingstone, Sara Wilkinson ____________________________________ 82
Reconsidering the ‘Internet Effect’: Real Estate Retail Outcomes in Australia & the UK
Stephen Roulac ____________________________________________________ 83
Thinking - In and Outside - The Box: Asynchronous and Substitutable, Hyper-complexity and
Predictability, Risk and Value, Sustainability and Permanence, Disruption and Destruction
G-1 Market Research, Analysis & Forecasting
Ke Qiulin, Karen Sieracki, Michael White _______________________________ 84
Transactions Based Commercial Real Estate Indices: A Comparative Performance Analysis
Sotiris Tsolacos, Kyung-Min Kim ______________________________________ 85
The Role of Liquidity in Forecasting Office Yields in Europe
XV
Tony McGough, Jim Berry ___________________________________________ 86
Bond Rate Trends and their Impact on the Relationship with Real Estate Yields
Fotis Mouzakis, Dimitrios Papastamos, Simon Stevenson _________________ 87
Rationality and Momentum in Real Estate Investment Forecasts
G-2 Market Research, Analysis & Forecasting
Keith Lown, Michael White ___________________________________________ 88
Cyclical and Structural Components to Yield Movements: The Case of Central London Offices
Ramiro J. Rodriguez ________________________________________________ 89
Hedonical Office Rents Index with Spatial Econometrics
Peter Sittler, Alexander Bosak ________________________________________ 90
The Office Market in Vienna: An Analysis of Trends and Cycles
G-3 Market Research, Analysis & Forecasting
Marian Alexander Dietzel ____________________________________________ 91
Sentiment-Based Predictions of Housing Market Turning Points with Google Trends
Charalambos Pitros, Yusuf Arayıcı _____________________________________ 92
How to Identify Housing Bubbles? A Decision Support Model
Michael Schier, Michael Voigtländer ___________________________________ 93
User Costs of Housing, House Price Developments and Real Estate Bubbles: Evidence from
Germany
Yuriy Kochetkov, Elena Grebenuk _____________________________________ 94
Short-term Cycles in the Residential Market of Moscow and St.Petersburg
G-4 Market Research, Analysis & Forecasting
Daniël Vos, Monique Arkesteijn, Clarine Van Oel, Hilde Remøy _____________ 95
Current Vacancy among Primary Schools in The Netherlands
Yener Coşkun, Ali Coşkun, H. Murat Ertuğrul, Ünal Seven _________________ 96
Testing for Bubbles in Turkish Housing Markets: A Comparison of Alternative Methods
Jonas Hahn, Paul Bartsch, Sven Bienert, Doğan Kesdoğan________________ 97
Universal Web Based Data Processing Model for Rental Housing Profitability Calculation of Energetic
Retrofitting
Arvydas Jadevicius, Simon Huston, Andrew Baum _______________________ 98
Two Centuries of Farmland Prices in England
G-5 Market Research, Analysis & Forecasting
Minou Weijs- Perrée, Rianne Appel- Meulenbroek, Bauke De Vries, Sjoerd
Romme __________________________________________________________ 99
Market Research on Business Centre Concepts in The Netherlands
Neil Crosby, Steven Devaney, Peter Wyatt ____________________________ 100
Development Viability Indicators for UK Regions – Construction and Evaluation of New Time-series
Estimates
XVİ
Vassiliki Vlachostergiou, Theodore Mitrakos, Calliope Akantziliotou ________ 101
Monitoring Commercial Property Prices during the Crisis: Evidence from Greece
Alastair Adair, Jim Berry, David McIlhatton, Bob Martens, Stanley McGreal, _ 102
European Real Estate Society Research Agenda: Looking Back and Projecting Forward
G-6 Market Research, Analysis & Forecasting
Áron Horváth, Gábor Révész ________________________________________ 103
Identifying Lag Relationships in the Office Market with a Turning Point Method during the Global
Financial Crisis
Charles Ostroumoff, Malcolm Frodsham _____________________________ 104
A Simulation Model to Minimise the Tracking Error between the IPD Annual Index Estimate and the
IPD Annual Index
Dieter Rebitzer, Mark Renz, Paolo Colucci _____________________________ 105
Economic Convergence in the EU and its Impact on Property Markets
Ke Qiulin, Karen Sieracki ___________________________________________ 106
Transaction Frequency and Property Price
H-8 Marketing & Communication in Real Estate
Markus Mändle, David Hummel _____________________________________ 107
Housing Co-operatives and Digital Democracy – Basic Aspects and Empirical Evidence
Yuen Leng Chow, Seow Eng Ong ___________________________________ 108
Personality and Sales Performance
Prashant Das _____________________________________________________ 109
Internet Search and Hotel Revenues
Peter Sittler_______________________________________________________ 110
The User Satisfaction and Usability of the Austrian Land Register Real Estate App “LexioMobil”
HD-4 Housing Markets & Economics II
Ahmet Büyükduman ______________________________________________ 111
House Price and Rent Developments in Istanbul: 1988-2012
Marc Francke ____________________________________________________ 112
The Price-Turnover Relationship in European Housing Markets
Wolfgang A. Brunauer, Wolfgang Feilmayr, Ronald S. Weberndorfer _______ 113
Residential Property Price Indices for Austria
Xin Janet Ge, Brendan Williams ______________________________________ 114
House Price Determinants in Sydney
HH-7 Housing & History
Mustafa Çağhan Keskin ____________________________________________ 115
Foundations and Real Estates of Yorguc Pasha Family through The Ottoman Endowment System
XVİİ
Bilge Ar __________________________________________________________ 116
Byzantine Building Stock after the Conquest of Constantinople in 1453
Nisa Semiz _______________________________________________________ 117
Property Issues of Istanbul Seawalls
Ayşe Tuğba Şengil ________________________________________________ 118
Seventeenth Century Residential Real Estate Prices in Istanbul
I-7 Performance and Risk Management
Olga Filippova ____________________________________________________ 119
Office Market Response to Earthquake-Prone Building Policy in New Zealand
Alexandra Bay ____________________________________________________ 120
Efficiency Measurement of Swiss Shopping Centers Using Data Envelopment Analysis (DEA)
Charles-Olivier Amédée-Manesme, Fabrice Barthélémy _________________ 121
Ex-ante Real Estate Value at Risk Calculation Method
Andréas Heinen, Mi Lim Kim, Alfonso Valdesogo _______________________ 122
Regime Switching House Price Dependence: Evidence from MSAs in the US
I-8 Performance and Risk Management
Chiara D'Alpaos, Rubina Canesi _____________________________________ 123
Risks Assessment in Real Esate Investments: An AHP Approach
Enareta Kurtbegu, Juliana Caicedo-Llano _____________________________ 124
Bootstrap Analysis for Asian REIT’s Portfolios
Mutale Katyoka, Simon Stevenson ___________________________________ 125
Real Estate Market Risk Modelling
J-8 PPF, PPP & Infrastructures
Daniel Wurstbauer, Christoph Rothballer ______________________________ 126
Systematic Risk Factors in European Infrastructure Stock Markets
Joanna Wegrzyn, Adam Nalepka, Agnieszka Telega ____________________ 127
Reasons for PPP in Poland - Taxonomic Analysis
Eero Valtonen, Heidi Falkenbach, Kauko Viitanen, Erwin Van der Krabben __ 128
Risk Allocation in Implementation of Urban Development Projects –Comparison of Finland, The
Netherlands, and The UK
K-1 Real Estate & Regional and Urban Economics
Elif Alkay, Berna Keskin, Craig Watkins ________________________________ 129
Explaining Spatial Variation in Real Estate Development Activity in Turkey
Ilir Nase _________________________________________________________ 130
A Study of English House Price Data with Spatial Dependence
Melike Karaca, Aliye Ahu Akgün _____________________________________ 131
Socio-Spatial Transformation by Gated Communities on the Peri-urban Areas
XVİİİ
K-2 Real Estate & Regional and Urban Economics
Lynne Michael ___________________________________________________ 132
Agglomeration Economies and Global Cities: The case of London, New York and Relativity
A. (Annette) Tjeerdsma, Ing. Jan Veuger ______________________________ 133
How Dutch Municipalities Manage their Community Real Estate
Dirk Kootstra, Ing. Jan Veuger _______________________________________ 134
Measuring the Added Value of Housing for Primary Education
Johannes Stiller, Dirk Assmann ______________________________________ 135
Knowledge Spillovers in Cities: The Creation and Transmission of Knowledge
K-3 Real Estate & Regional and Urban Economics
Anil Kashyap, Jim Berry ____________________________________________ 136
The Impact of Mass Transit System on Property Values in India
Simon Huston ____________________________________________________ 137
Regional Emerging Hubs - Catalysts, Drivers and Constraints
Merve Kaya, Ferhan Gezici Korten ___________________________________ 138
The Impacts of Real Estate Projects on Transformation of Centres in Izmir
Buğra Kağan Esen ________________________________________________ 139
How Shall the Governance of the Urban Renewal Projects at Historical Sites be Performed? –
Example of the Izmir Kemeralti District
K-4 Real Estate & Regional and Urban Economics
Nicole Braun, Philipp Schäfer _______________________________________ 140
Short-term Rentals and Housing Rents. The Case of Airbnb in Berlin
Kristin Wellner, Friederike Landau, Claus Müller ________________________ 141
Housing Economics and Changing Residential Quality in Berlin
Dieter Rebitzer, Paolo Colucci, Mark Renz _____________________________ 142
Impact of the Rent Brake on German Housing Markets
K-5 Real Estate & Regional and Urban Economics
Ding Hsiu-yin _____________________________________________________ 143
Does Land Fragmentation Delay the Implementation for Urban Renewal?
Ayşe Nur Albayrak _________________________________________________ 144
Industrial Decentralization as a Real Estate Development Project: Gebze Case
Jessie Bakens, Gwilym B Pryce _____________________________________ 145
Ethnic Mover Flows and Neighborhood Change in Scotland
K-6 Real Estate & Regional and Urban Economics
Colin Jones, Nicola Livingstone _____________________________________ 146
The Restructuring of the UK Urban Retail Hierarchy and the Consequences for Real Estate
Investment
XİX
Costin Ciora ______________________________________________________ 147
Behavioral Real Estate. A Literature Review
Gheorghe Petru Multescu, Ala Daugeliene _____________________________ 148
Developing Resilient Property Markets in the Wake of the 2008 Economic Crisis
Tony Shun -Te Yuo Yuo ____________________________________________ 149
Retail Rents and Spatial Patterns of Product Variety in Urban Shopping Areas
K-7 Real Estate & Regional and Urban Economics
Mehmet Akif Levent, Semih Adil, Ayşe Gökbayrak _______________________ 150
Real Estate Valuation use in Urban Transformation Projects
Mohsen Shojaee Far, Carlos Marmolejo Duarte ________________________ 151
Does 3D Information Modeling Give Better Vision to Deal with Future Real Estate Capacities of
Inaccessible Areas within Conflict Zones?
Mehmet Topçu ___________________________________________________ 152
Relationship between Urban Development and Housing Values: The Example of Konya
Juan Camilo Echavarria Ochoa, Carlos Marmolejo Duarte _______________ 153
Diversity Analisys: The Case of Barcelona Metropolitan Region
L-5 Real Estate Development
Magdalena Zaleczna, Rafal Wolski ___________________________________ 154
The Polish Real Estate Market as an Area for Developers
Graham Squires, Norman Hutchison, Alastair Adair, Stanley McGreal,
Samantha Organ __________________________________________________ 155
Innovative Finance for real Estate Development in Pan-European Regeneration
Kevin Meyer, Andreas Pfnür _________________________________________ 156
Cognition Biases in Real Estate Investment Decisions. Empirical Evidence from the German
Development Market
Cath Jackson, Allison Orr ___________________________________________ 157
Integrating Interests: Consumers-Retailers-Investors
L-6 Real Estate Development
Nurbanu Türgen __________________________________________________ 158
Project Management in Real Estate Development Projects
Joanna Wegrzyn, Michal Gluszak ____________________________________ 159
The Success of PPPs in Poland
Jovita Nnametu, Iheanyi Alaka, Derek Fidelis Chikezie Okoronkwo _________ 160
Staff Housing: Panacea to Academic Productivity (Nigerian Institutions)
Andrej Adamušcin _________________________________________________ 161
Analysis of the Retail Market Development in Bratislava with a Focus on Retail Function and its Wider
Relations within the City
XX
L-8 Real Estate Development
Berndt Lundgren, Fan Yang Wallentin _________________________________ 162
Measuring the Effect of Unobservable Factors in Residential Choice Behaviour
Martina Bendová, Saija Toivonen ____________________________________ 163
Residential Infill Development – The Connection between Inhabitants’ Attitude and Areal
Characteristics
Huub Ploegmakers, Pascal Beckers __________________________________ 164
The Impact of Planning on Business Development
MNR-5 MENARES
Reyhaneh Rahimzad, Ali Parsa, Simon Huston ________________________ 165
Evaluating Mega Urban Regeneration Projects: Developing a New Model
Yasser Zanjiri, Ali Parsa ____________________________________________ 166
Financing Real Estate and Urban Regeneration in Iran
Leila Shojaei, Ali Parsa _____________________________________________ 167
Sustainability, Tall Buildings, High Density and Compact City Development: Dubai Marina, Dubai,
United Arab Emirates
Ali Hepşen, Olgun Aydın, Orhan Vatandaş _____________________________ 168
Housing Market Annual Gross Yield Modelling: A Comparison between two Dynamic Markets
(Istanbul and Dubai)
N-6 Real Estate Education
Margaret McFarland, Hossein Lavasani _______________________________ 169
Multi-disciplinary Real Estate Education: A Comparison of a US and European Approach
Kathryn Robson, Guillermo Aranda- Mena, James Baxter ________________ 170
Industry Expectation of Australian Property Higher Education Programs
Pieter Le Roux ___________________________________________________ 171
Creating Future-Proof Learning Environments - A Study on Educational Objectives and Conceptual
Decision-Making
Anil Kashyap, Saumya Shirina _______________________________________ 172
Ethics in Real Estate Firms in India
N-8 Real Estate Education
Mohd Haris Yop __________________________________________________ 173
Future Direction of Real Estate Education for the Certificate Programs at National Institute of Valuation
(INSPEN)
Bob Thomson, Bob Martens ________________________________________ 174
Blended Learning in Real Estate Education: A Survey
Stephen Roulac ___________________________________________________ 175
What Do Students Need To Know About Property? What Do Textbooks Actually Teach About
Property?
XXİ
Gisela Vogt, Dieter Rebitzer _________________________________________ 176
Integration of Internationally Orientated Content into Real Estate Education Programmes -
Exemplified by the Degree Programmes at Nuertingen-Geislingen University
O-1 Real Estate Finance & Investment
Graeme Newell ___________________________________________________ 177
The Performance and Diversification Benefits of European Non-listed Real Estate Funds
Chetna Batra ____________________________________________________ 178
Evaluating Financial Health of Real Estate & Construction Industry in India
Rachael Daisy Mirembe, Isaac Nabeta Nkote, Augustine Matovu _________ 179
Mortgage Financing and the Performance of Real Estate Business in Uganda; Lessons a from a
Developing Country Context
Kaia Kask, Priit Sander, Kantšukov Mark ______________________________ 180
CAPM versus Expert Opinion: Do Practitioners’ Perceptions Meet Theory? Evidence from the Survey
of Estonian Commercial Real Estate Market
O-2 Real Estate Finance & Investment
Arvydas Jadevicius, Stephen Lee ____________________________________ 181
UK REITs Don't Like Mondays
Stephen Lee _____________________________________________________ 182
Herding in the UK Real Estate Market
David Parker _____________________________________________________ 183
Idiosyncratic Risk in Direct Property - A Review of the Literature
Giacomo Morri, Alessandro Baccarin _________________________________ 184
European REITs NAV Discount: Market Sentiment and Fundamental Factors
O-3 Real Estate Finance & Investment
Brent Ambrose, Michael Shafer, Yıldıray Yıldırım ________________________ 185
The Impact of Tenant Diversification on Spreads and Default Rates for Mortgages on Retail
Properties
Stephen Ryan, Matthew Richardson _________________________________ 186
Behavioural Biases among Real Estate Investment Decision Makers. Has Anyone Seen My Neo-
cortex? I’m Sure I Left It Here Somewhere.
Patrick Krieger, Carsten Lausberg ___________________________________ 187
Decisions, Decision-making, and Decision Support Systems in Real Estate Investment Management
Sebastian Schnejdar, Michael Heinrich________________________________ 188
Explaining the Discount in Closed Open-Ended Real Estate Funds in Germany
O-4 Real Estate Finance & Investment
Graeme Newell ___________________________________________________ 189
The Changing Real Estate Market Transparency in the European Real Estate Markets
XXİİ
Simon Stevenson _________________________________________________ 190
Volatility Transmission: A Global Tri-Variate Analysis of Public Real Estate and Foreign Exchange
Markets
Paul Ryan, Clare Branigan __________________________________________ 191
The Irish Real Estate Bubble: A Behavioral Finance Perspective
Omokolade Akinsomi, Seow Eng Ong, Muhammad Faishal, Graeme Newell 192
Does Being Islamic or Shariah-compliant Affect Capital Structure? Evidence from Real-estate Firms
in the Gulf Cooperation Council States.
O-6 Real Estate Finance & Investment
Alex Moss, Hans Vrensen, Nigel Almond ______________________________ 193
Establishing a Blended Global Real Estate Investment Strategy Using Transaction Based Indices
Annisa Dian Prima, Simon Stevenson _________________________________ 194
Investor Protection, Corporate Governance and Firm Performance: Evidence from Asian Real Estate
Investment Trusts
Steven Devaney, David Scofield _____________________________________ 195
Measurement and Drivers of Time to Transact UK Commercial Real Estate Investments
P-1 Real Estate Portfolio Management
Sevtap Kestel, Yener Coşkun, Bilgi Yılmaz, ___________________________ 196
A Comparative Study on REIT Returns in Istanbul Stock Exchange by Using Single Index and Fama-
French Methods
Omokolade Akinsomi, Lloyd Kemp, Boitumelo Masilela, Nishaan Ansary ___ 197
The Effects of REIT Sub-Categories on Mixed-Asset Portfolios in South Africa
Rafal Wolski _____________________________________________________ 198
Investment Risk in the Context of Price Changes in the Real Estate and Capital Markets
P-2 Real Estate Portfolio Management
Işıl Erol, Doğan Tırtıroğlu ____________________________________________ 199
Pricing of IPOs: The Unique Case of Turkish REITs
Charles-Olivier Amédée-Manesme, François des Rosiers, Philippe Grégoire _ 200
The Pricing of Embedded Lease Contracts Options
Alex Moss, Kieran Farrelly __________________________________________ 201
Alternative Index (Smart Beta) Strategies for REIT Mutual Funds
Q-1 Real Estate Valuation
Nick French, Laura Gabrielli ________________________________________ 202
Pricing to Market - Property Valuation Methods Revisited
John MacFarlane _________________________________________________ 203
Statutory Valuation and the Use of Automated Valuation Models
Ytzen Van der Werf, Fred Huibers ____________________________________ 204
Effect of Changing Valuer on Real Estate Portfolio Valuations
XXİİİ
Q-2 Real Estate Valuation
Carlos Marmolejo Duarte, Juan Camilo Echavarria Ochoa ________________ 205
Does Urban Subcentres Influence Housing Prices? An Analysis of the Metropolitan Region of
Barcelona
Peter Palm, Helena Bohman, Magnus Andersson _______________________ 206
Anchoring Effects in Appraisals – A Study of Swedish Real Estate Students
Anja Dust, Kathleen Evans, Carsten Lausberg, Marcel Schmid,
Francois Viruly ___________________________________________________ 207
Reducing the Property Appraisal Bias with Decision Support Systems
Paulo Castanheira ________________________________________________ 208
Evolution of the Explanatory Variables of the Price of Real Estate in Lisbon during the Last Economic
Crisis
Q-3 Real Estate Valuation
Ari Laitala, Juhana Hiironen, Mikael Postila, Kauko Viitanen _______________ 209
Value of the Energy Performance Certificates in the Housing Market – What is the Weight as
Evidence of Open Data?
Marko Kryvobokov ________________________________________________ 210
Housing Rents in Wallonia, Belgium: The Observation System and Market Segmentation
Sr. Faziah Abd Rasid ______________________________________________ 211
Assessing the Most Suitable Valuation Approaches and Methodologies for Stratum Title in Malaysia
Wolfgang Feilmayr ________________________________________________ 212
Levels and Development of Real Estate Prices in Different Austrian Regions
Q-4 Real Estate Valuation
Peter Elliott, Clive Warren, Jason Staines _____________________________ 213
The Effects of Demolition Control Precincts on Property Values
Douw Boshoff ____________________________________________________ 214
The Use of Options Pricing Methods for the Valuation of the Bare Dominium Value of Property with a
Long Term Land Lease
Nan-Yu Chu _____________________________________________________ 215
The Effect of Strategy Alliance on Property Values: A Case Study of Hotels in Taiwan
Lina Bellman, Peter Öhman _________________________________________ 216
How Authorized Property Appraisers Construe Information for Valuation of Commercial Properties: A
Repertory Grid Study
R-8 Tax and Legal Issues in Real Estate
Ramón Sotelo ____________________________________________________ 217
Actual Topics within Germanys Housing Policy
XXİV
Sebastian Johann _________________________________________________ 218
Development of Refurbishment Concepts – The case of Multi-family Houses from the 1970s in
Western Germany
Mike Hefferan ____________________________________________________ 219
Contemporary Challenges to Statutory Valuation Systems-The Australian Experience
PAN-1 PANEL - EPRA Public Real Estate Investments; An International
Perspective
Alex Moss _______________________________________________________ 220
The Performance Implications of Adding Global Listed Real Estate to an Unlisted Real Estate
Portfolio
Marielle Chuangdumronsomgsuk, Colin Lizieri _________________________ 221
Diversification Gains, Sector Exposure and Systematic Risk in International Public Real Estate
Markets
Martin Hoesli, Elias Oikarinen _______________________________________ 222
Are Public and Private Real Estate Returns and Risks the Same?
Martin Hoesli, Stanimira Milcheva, Alex Moss __________________________ 223
The Impact of Financial Regulations on The European Listed Real Estate Sector
PAN-4 PANEL – MSCI Globalisation of Real Estate Investment
Alex Moss, Nicole Lux ______________________________________________ 224
The Impact of Liquidity on Valuation and Capital Raising for Global Listed Real Estate Companies
Mark Clacy-Jones _________________________________________________ 225
Managing Performance & Risk through Blended Global Investment Strategies
Bert Teuben, Peter Hobbs, Mark Clacy-Jones __________________________ 226
The Listed Funds’ Real Estate Investment Process: Linkage between Asset Strategy & Reporting and
Investor Objectives
PHA-1 Doctoral Presentation
Ignas Gostautas __________________________________________________ 227
Electricity Consumption and House Values
Ebraheim Labash, Simon Huston ____________________________________ 228
Residential Valuation Systems in the United Arab Emirates
Liming Yao, Michael White, Alla Koblyakova ___________________________ 229
House Price Appreciation and Housing Affordability: A Study of Younger Households Tenure Choice
in China
Magdalena Teska _________________________________________________ 230
Income Distribution and Housing in Poland between 2004 and 2012
XXV
PHA-2 Doctoral Presentation
Randy I. Anderson, Nico B. Rottke, Sebastian Krautz ____________________ 231
Is Real Estate Private Equity Real Estate?
Thomas Müller ___________________________________________________ 232
The Trade-off between Housing and Pensions in the Household Portfolio of the Eldery
Frank Kwakutse Ametefe, Simon Stevenson, Steven Devaney _____________ 233
Toward a Liability Driven Investment Paradigm for DC Pensions: Implication for Real Estate
Allocations
Pau Blasi, Alain Cohen, Arnaud Simon ________________________________ 234
The Determinants of Historical Property Market Risk Premium in the London Office Market
PHB-1 Doctoral Presentation
Nurul Hana Adi Maimun, Jim Berry, Stanley McGreal, Michael McCord _____ 235
The Impact of Energy Performance Certificates on the Prices of Dwellings
Deborah Miriam Leshinsky _________________________________________ 236
Resolving Value through the Court System
Claudia Ascherl, Wolfgang Schaefers _________________________________ 237
IPO Underpricing of European Property Companies
Ari Laitala ________________________________________________________ 238
Summarizing Doctoral Thesis: Hunt for the Green Value
PHB-2 Doctoral Presentation
Mohsen Shojaee Far, Carlos Marmolejo Duarte ________________________ 239
Impacts of Abandoned Properties in Conflict Zones (Geopolitical Brownfields) on Real Estate
Development & Regeneration Possibilities: Case of Cyprus Conflict
Henri Lüdeke _____________________________________________________ 240
Real Estate Contribution Margin System with Hierarchical Structure Effects a Concept for Real Estate
Residential Companies and Cooperatives
Patrick Krieger ____________________________________________________ 241
Investigations into the Reasons for Non-normal Real Estate Returns – Time Matters!
Kateryna Kurylchyk ________________________________________________ 242
Real Estate Investment Risks: The Case of Central and Eastern Europe
Keyword Register _________________________________________________ 243
Author Index _____________________________________________________ 247
Paper Number:276 Asset, Property&Facility Management
A-5
ERES 2015 Conference 24-27 June 2015 Istanbul 1
Building Information Electronic Modeling (BIM) Process as
an Instrumental Tool for Real Estate Integrated Economic
Evaluations
Mohsen Shojaee Far, Center of Land Policy and Valuations (CPSV), Polytechnic
University of Catalonia, Spain
Ioanna Alsasua Pastrana, Center of Land Policy and Valuations (CPSV), Polytechnic
University of Catalonia, Spain
Carlos Marmolejo Duarte, Center of Land Policy and Valuations (CPSV), Polytechnic
University of Catalonia, Spain
The initial costs of a building are quite small in comparison to the life-cycle costs,
as it is estimated that they represent less than 30% of the total life-cycle cost of a
building. Accordingly if we consider integration of the life-cycle cost of a building
into the estimation of investment values, then we would have a better and clearer
idea of how much our total operation costs is during and after construction
process. This integration possibility would positively affect the decisions of private
investors about their investment and also assist the public sector to decide on
better proposals for civic buildings, where integration of running cost into total
investment may provide more efficient decisions. However, traditional forecasting
methods are not accurate, and it may not demonstrate the reality. Therefore the
main focus of this study is an investigation on a practical and instrumental
methodology based on technological possibilities in the AEC industry, where
integration of building information electronic modelling (BIM) processes into real
estate economic evaluations suggested. Findings of this study demonstrate the
opportunities to manage and estimate a reliable and accurate information on a
building’s life cycle in real time by considering each element and its components
into the calculation, which may change the metrics for a real estate economic
evaluation in order to achieve sustainable and efficient property investment
towards smart city agendas.
Keywords: BIM, facility management, life cycle, real estate, smart city
Paper Number:52 Asset, Property&Facility Management
A-5
2 ERES 2015 Conference 24-27 June 2015 Istanbul
Conceptual Framework for Measurement of Asset
Depreciation on Buildings
Kaia Kask, University of Tartu, Estonia
Asset depreciation is an important issue in many economic decisions made either
by private or public sector institutions in all times. For example, the methodology
and measurement issues of asset depreciation are influencing capital budgeting
decisions in corporate finance and also major capital expenditure decisions that
concern public sector long-term investments.
As the depreciable assets come in many forms, there is still large gaps in literature
that need to be filled in order to develop comprehensive estimates of depreciation
for tax and accounting purposes (Hulten 2008: 1). Also, as it is asserted by Diewert
(2005), the accounting for the contribution of capital to production is more difficult
than accounting for the contributions of labor or materials, because – when a
reproducible capital input is purchased for use by a production unit at the
beginning of an accounting period, it is not possible to simply charge the entire
purchase cost to the period of purchase. Since the benefits of using the capital
asset extend over more than one period, the initial purchase cost must be
distributed somehow over the useful life of the asset. This is the fundamental
problem of accounting (Diewert 2005: 480), which has been solved by the
calculation of asset depreciation.
The current literature about depreciation in general is very broad and well-
researched and it may seem that everything in that field has been done already.
Nevertheless, looking more thoroughly the overwhelming literature written about
asset depreciation, the author of the current paper has found that there is a lack
of systematic approach to the background of the topic with thorough theorization
about the connections and links with other relevant problems, like capital
expenditure, user cost of capital, asset price and asset rental price. Therefore, the
aim of the current paper is to develop a systematic theoretical framework for a
building asset depreciation concept that would integrally account all the
mentioned co-factors, stemming from the fact that building asset does have some
special features over other (durable) assets like vehicles and machinery. The
paper also sets up a research question, whether at the long-run equilibrium level,
the cost of capital used to discount the cash flows from the building asset, should
equal at least the depreciation rate of the same asset?
Keywords: Asset depreciation, asset rental price, building maintenance, capital
expenditure, user cost of capital
Paper Number:148 Asset, Property&Facility Management
A-5
ERES 2015 Conference 24-27 June 2015 Istanbul 3
Good Buildings Drive out Bad Buildings? Defining the
Dogs and the Stars
Hilde Remøy, Real Estate & Housing, Faculty of Architecture, Delft University of
Technology, The Netherlands
Hans De Jonge, Real Estate & Housing, Faculty of Architecture, Delft University of
Technology, The Netherlands
Financial and real estate crises and “new ways of working” reduce the need for
office space. For example in Amsterdam, currently 17% of the office space is
vacant, of which 60% is structurally vacant. As a consequence, office markets
have become replacement markets without a quantitative need for new office
buildings: Good buildings drive out bad buildings.
When relocating, office organisations consider buildings and locations within
geographically defined markets that optimally facilitate their main processes,
reduce costs, optimise flexibility, and support image and financial yield.
Sustainability is important for organisations to define their image and comply with
customer expectations. Hitherto, new office developments were the response to
this demand. Meanwhile, vacancy, financial scarcity, public opinion and
governmental policy oppose new office construction in locations with high
vacancy. New strategies are needed to respond to the demand for sustainable
office space and limit new developments. Adaptive reuse of the existing building
stock and new adaptive buildings could be the key.
The revealed preferences of office users and organisations are important to
understand office building obsolescence and lifespan. In former research the
relationship between property characteristics and office user preferences was
revealed. This paper aims at answering the question: which physical
characteristics are found to reduce the risk of office building obsolescence?
To answer this questions, an extensive literature review is done on revealed
preferences, location and building quality, and obsolescence studies. Henceforth,
empirical studies are conducted in the Dutch office market to outline the
relationship between physical characteristics and reduced risk of office building
obsolescence.
Keywords: Commercial office real estate, lifespan, obsolescence, revealed
preferences, vacancy
Paper Number:217 Asset, Property&Facility Management
A-5
4 ERES 2015 Conference 24-27 June 2015 Istanbul
Improving the Purchase Decision in Real Estate Asset
Management by Debiasing Decision-makers
Carsten Lausberg, Nurtingen-Geislingen University, Germany
Franziska Piepke, University of Hamburg, Germany
The question how real estate investment decisions should be made and are
actually made has been extensively discussed in the literature. However, some
behavioral aspects such as the effect of the anchoring bias on the quality of
purchase decisions or the effectiveness of debiasing strategies have been
neglected so far. It can be assumed that these aspects greatly influence decision-
making in real estate—-as has been convincingly shown for other areas.
This paper examines whether the anchoring effect occurs in real estate asset
management and if this bias can be minimized using debiasing-strategies. To
answer our research question we set up an experiment in which we asked 152
real estate experts to form an opinion about the ceiling price for a property
described in an investment memorandum. We found that the probands anchored
their opinion to the given offering price. That was in line with our expectations and
the previous literature. But we also found that a simple debiasing strategy,
considering a worst-case scenario, significantly reduced the unwanted anchoring
effect. The results show that there are promising ways to improve decision-
making. More research is needed until our findings can be incorporated in
decision processes and decision support systems.
Keywords: Anchoring, debiasing, decision-making, real estate asset
management
Paper Number:22 Asset, Property&Facility Management
A-6
ERES 2015 Conference 24-27 June 2015 Istanbul 5
Major Drivers of Baltic Shopping Centres’ Market
Leva Kvedaraviciene, ISM University of Management and Economics, Lithuania
The paper takes into consideration the complexity of shopping centres’ segment
in the context of changing economy as well as in comparison with other real estate
segments. It has often been said that the dynamics of retail real estate are three-
dimensional (Shopping centre management, ICSC, 1999) while those of most
other real estate formats are two-dimensional. The reasoning behind the
comparison is that most nonretail real estate – office, apartment and warehouse
formats, for example – are based upon a simple landlord-tenant relationship.
Shopping centres and other retail real estate formats are based upon a more
complex dynamic which includes the same two parties plus customers, who must
patronize tenants’ stores in order to the process to work – thus creating a three-
party process. The complexity results from the additional challenges related to
finding the appropriate assortment of tenants who can effectively attract enough
consumers to support the business plan, including paying the landlord’s rents.
Moreover, in most cases, the fourth party – lender – plays important role when
providing capital needed by shopping centre owners to build, purchase of finance
a centre.
The aim of the paper is to analyze the major Baltic shopping centre market drivers
in the context of three dimensional dynamics as well as changing economy and
discuss the key drivers’ impact for the segment development and change, as retail
segment adapts to various challenges and opportunities more rapidly than the
most of other real estate formats
Keywords: Baltic shopping centers, customer as a change agent, market
drivers, shopping centers market
Paper Number:138 Asset, Property&Facility Management
A-6
6 ERES 2015 Conference 24-27 June 2015 Istanbul
Adaptive Reuse of Offices: Residential Conversions in
Sydney
Hilde Remøy, Real Estate & Housing, Faculty of Architecture, Delft University of
Technology, The Netherlands
Sara Wilkinson, University of Technology, Australia
The built environment contributes 40% to total global greenhouse gas emissions
and 87% of the buildings we will have in 2050 are already built. If predicted climate
changes are correct we need to adapt existing stock sustainably. Reuse is an
inherently sustainable option, which reduces the amount of waste going to landfill.
Inevitably settlements and areas undergo change, whereby land uses become
obsolete and buildings vacant. At this stage, the options are either to demolish or
to convert to another use. In central business districts (CBDs) outside of Australia
there is a long history of office to residential conversion. Although these types of
conversions are few in number in the Sydney CBD, a trend is emerging in
conversion. Some 102,000m2 of office space is earmarked for residential
conversion in Sydney as demand for central residential property grows and low
interest rates create good conditions. Coupled with this, is a stock of ageing
offices and a population projected to increase by 4% to 2031 requiring 45000 new
homes. With the Sydney market about to be flooded with the Barangaroo office
supply in 2017, the conditions for residential conversion are better than ever.
Based on the foregoing, this paper aims at answering the questions: which drivers
drive residential conversions in Sydney? And what are the barriers for successful
conversions? This paper investigates the nature and extent of residential
conversion in Sydney, as well as the drivers and barriers to successful conversion.
Through an extensive literature study, the paper identifies the key lessons from
international residential conversion projects. Subsequently, expert interviews are
held with developers in the Sydney market. This paper explores the potential of
delivering sustainability to the Sydney CBD through residential conversion.
Keywords: Building adaptation, land use, residential conversion, sustainability,
vacancy
Paper Number:240 Asset, Property&Facility Management
A-6
ERES 2015 Conference 24-27 June 2015 Istanbul 7
Implications from Fiscal Impact Analysis of Public Sector
Real Estate Asset Management Models
Kaia Kask, University of Tartu, Estonia
Countries are different in terms of territory, population, income, their traditions and
habits vary, and also the ways, how they handle their public sector real estate
management is not the same. Still, there are a lot of common features, which are
universal to bear in mind while making decisions over the use of taxpayers’
money. On one hand, in every country the government has to administrate in
terms of budgetary constraint, but on the other hand, in every democratic country
the public sector has been evoked to serve the interest of the citizens of that
country. On the public sector level, there is a general agreement that government
authorities need to make state-concerning financial decisions prudently, weighing
carefully the consequences in executing different scenarios of action. Smaller
countries like Estonia have fewer opportunities and scantier resources (both
human and financial) to deal with the complex problems concerning large
amounts of capital assets, and therefore decisions over public sector real estate
issues need to be made even more diligently.
The paper fills the gap in the literature, where no quantitative level analysis of
public sector real estate management has been elaborated. In this paper, an
Estonian example has been taken in order to analyse the results from four different
state real estate asset management scenarios, called as models. Therefore, the
aim of the paper is to draw the implications of public sector real estate asset
management models, based on the quantitative fiscal impact analysis on state
budget and government sector account. The state real estate assets are viewed
in two separated classes – as general-purpose properties and special-purpose
properties.
On the one hand, the research shows an extreme complexity of the
implementation of public sector real estate asset management (PREAM), but on
the other hand, the paper shows that the model-based asset management
decision-making and quantitative evaluation of fiscal impact on the level of public
sector real estate is applicable also in practice. Implications made out of the
research should give some broader enlightment about the problems arising from
the similar kind of model-based analysis of the performance of PREAM in other
countries.
Keywords: PREAM models, asset management, benefit-cost analysis, fiscal
impact analysis, public sector real estate
Paper Number:89 Corporate Real Estate
B-1
8 ERES 2015 Conference 24-27 June 2015 Istanbul
Impact of Corporate Real Estate on UK Business
Howard Cooke, Corporate Occupier Real Estate Consulting, UK
Rianne Appel Meulenbroek, Eindhoven University of Technology, The Netherlands
Purpose: Corporate Real Estate (CRE) directly impacts upon the performance of
business, as a cost and in providing the environment for it to operate in. Lease
length and the total financial commitment is rarely understood and is not a
prominent part of the decision-making process. However, the financial burden of
property can hamper business and indeed lead to its failure. The purpose of the
research is to establish the scale of the commitment to CRE; examine how it varied
over the period 2007 to 2013 (namely into and out of the financial crisis and the
recession), in absolute terms and against profitability; determine portfolio flexibility
(or anticipated inflexibility) and establish whether business can resize the property
portfolio in reaction to changes in the business environment.
Design/methodology/approach: The research approach was to examine the
published financial accounts of the top 350 quoted companies listed on the
London Stock Exchange. The first stage was to extract the data for the individual
companies for the years 2007 to 2013 inclusive. The data included turnover;
profitability; net asset of the company; property book value; Full Time Employees;
property provisions and the profile of property lease commitments. Companies
were grouped in business sectors, such as retailing, industrial, etc., for analysis.
The analysis examines the lease length profile; the cost of property against
turnover and profitability and relative to the headcount within the organisation; and
how the provision for surplus property compares to profitability. It considers the
sectors on an individual year basis and how the ratios have changed from 2007
to 2013. The underlying focus was to assess how business reacted to the financial
crisis and the recession. That was measured by reference to changes in turnover,
profitability and headcount through and out of the recession. Allied to that the
question was how did business seek to change its property cost base and what
correlation is there between the various metrics. The process of abstracting data
and analysis is on going, and with that how business is recovering from the
recession. Sectorial differences as well as the overall patterns are examined.
Findings: The analyses indicated that the impact of the recession was relatively
transitory. The retail sector, as an example, showed for 2007 to 2012 that the total
lease commitment expanded by circa £1,500m rising to £9,387 in 2012. Through
Keywords: Benchmarking of CRE, financial commitment to CRE, metrics,
surplus property
Paper Number:102 Corporate Real Estate
B-1
ERES 2015 Conference 24-27 June 2015 Istanbul 9
How to Align the Organization of the CREM-department to
Strategy during a Recession
Thijs Ploumen, Department of Real Estate Management and Development, Eindhoven
University of Technology, The Netherlands
Rianne Appel- Meulenbroek, Eindhoven University of Technology, The Netherlands
Jos Smeets, Department of Real Estate Management and Development, Eindhoven
University of Technology, The Netherlands
Purpose-In times of recession a lot of companies need to reduce costs. This also
affects the budgets that are available for corporate real estate (CRE). Therefore it
is important that the organization of the CRE management (CREM)-department is
optimally aligned with CRE-strategy. This study provides a tool for evaluating the
organization of the CREM-department when applying the CRE-strategy of cost
reduction. Design/methodology/approach-The evaluation tool for alignment of the
organization of the CREM-department is a result of an explorative study. First a
literature study was conducted which led to a theoretical model of factors that
influence the organization of the CREM-department, with regard to five
components: Organizational structure, Sourcing, Centralization, Process
management and Company culture. Then empirical data was collected through
interviews with two groups of respondents, namely CREM-departments who
served as cases and CRE-consultants to hear their expert opinions. Cross-case
analysis and a comparison of these results with the expert opinion of the
consultants were used to look for links between the CREM department
components and each CRE strategy. Findings-It was not possible to formulate
links between every possible CRE strategy and the CREM-organization as most
of the cases had implemented the same strategy, namely cost reduction. This did
provide the opportunity to construct a clear evaluation model for this particular
strategy. Not all the themes were aligned with the chosen CRE-strategy identically
by all the CREM-departments with a cost reduction strategy, but many similarities
came forward and were backed by the CREM experts. This was worked into an
evaluation model on the alignment of the organization of the CREM-department
with a cost reduction strategy. Research limitations/implications-The model
developed is especially relevant for CREM-departments who have similar
characteristics as the CREM-departments who served as cases: large companies
with a division macro-organizational structure that apply the CRE-strategy of cost
reduction. The evaluation model does not spell out exactly how the CREM
organization should be managed and formed, but does provide insight in a
number of main choices that can influence the organization of CREM. The
purpose of the evaluation model is that the CREM department becomes aware of
the consequences for the organization of CREM when implementing a cost
reduction aimed CRE-strategy.
Keywords: CREM organization, cost reduction, model, strategy
Paper Number:156 Corporate Real Estate
B-1
10 ERES 2015 Conference 24-27 June 2015 Istanbul
Health and Wellbeing Sector Actors Embrace
Collaboration and even Competition On-campus
Riikka Kyrö, Aalto University School of Science, Finland
Antti Peltokorpi, Aalto University School of Science, Finland
Karlos Artto, Aalto University School of Science, Finland
The purpose of this study is to understand how multiple actors from the same
business sector perceive operating on a campus setting. The main focus is on the
relationships between tenants on-campus, as well as on identifying potential
derived from the location on-campus. The study is a qualitative case study of two
health and wellbeing campuses in Finland. The cases share some key
characteristics, but are in different phases of their life-cycles. The similarities and
differences between the two campuses provide fertile ground for comparison.
Altogether 19 semi-structured interviews of organisations operating on the two
campuses comprise the main source of data.
The interviewed actors appreciated the joint resources and facilities provided by
the campus. Joint resources were thought to comprise human capability and
technology, but also reputation and brand. Specialised health care equipment
and facilities are particularly beneficial to share due to their expense and lower
utilisation rate. However, also joint restaurant, parking, reception and other facility
services were appreciated. Additionally, informal joint areas allowing spontaneous
interaction, such as coffee rooms and open hallways were mentioned as a
preference. The campus enables providing supplementing services and products
for a shared customer segment in a “Health and Wellbeing Shopping Centre” type
of setting. Interestingly, even competition was tolerated and welcomed by the
actors. The reasoning was that, access to a wider offering would be beneficial for
potential customers, and therefore the whole campus. The informants considered
essential that all actors on-campus share a common vision and goals. A potential
threat was identified in the lack of an impartial integrator onsite.
The study indicates that tenants benefit from the possibility to operate on a
campus designated for a specific business sector from both practical (joint facility
services) and strategic (joint vision) perspective. The findings provide interesting
insight for both real estate owners and corporate real estate professionals. For the
former, the findings may be useful when planning a tenant-mix, or retrofitting
facilities. The latter might consider the findings when re-locating and selecting new
facilities. It should be noted that, the study is explorative in nature and the findings
cannot necessarily be generalised beyond their context. Further studies with
cases from outside Finland would be of interest.
Keywords: Campus, corporate real estate, facilities, health and wellbeing, multi-
tenant
Paper Number:158 Corporate Real Estate
B-1
ERES 2015 Conference 24-27 June 2015 Istanbul 11
Adding Value by Corporate Real Estate: Parameters and
Applications
Theo Van der Voordt, Delft University of Technology, Faculty of Architecture,
Department of Real Estate & Housing, The Netherlands
The concept of adding value by real estate from the perspective of the end user
is "hot". The search for added value is included in current research within both the
fields of Corporate Real Estate Management (CREM) and Facility Management
(FM) and is also a popular subject in curricula at universities and other institutions
of higher education. However, a review of literature shows a lack of consistency
in definitions and value parameters. Besides, still much work has to be done to
operationalise different value parameters and to be able to measure the benefits
and costs of CREM and FM interventions in a reliable and valid way. This paper
first explores the meaning of added value in connection to other concepts such
as the match between demand and supply and alignment of real estate to
organisational aims and objectives. Then an overview will be presented of different
value dimensions based on an extensive review of the literature. Furthermore the
paper presents the findings of empirical research within the health care sector
regarding the values that are incorporated in value adding management, which
values are prioritized and why, and how health care organisations link their
choices regarding real estate and building related facilities to their organisational
objectives. The methods range from interviews with CEOs, project managers and
facility managers in hospitals and facilities for assisted living of the elderly, to a
web-based survey among real estate managers and facility managers working in
the mental health care sector. The data from different research projects are
compared on prioritized aspects and measures to support cost reduction, labour
productivity, user satisfaction, and other values. The paper also includes an
exploration of how to explain similarities and dissimilarities in prioritized aspects
between different organisations and different sectors, and reflections on the gaps
between theory and practice. The paper ends with some practical
recommendations and recommendations for further research.
Keywords: Added value, corporate real estate, health care, performance
measurement, value parameters
Paper Number:86 Corporate Real Estate
B-2
12 ERES 2015 Conference 24-27 June 2015 Istanbul
Determinants of Satisfaction amongst Occupiers of
Commercial Property
Danielle Claire Sanderson, School of Real Estate and Planning, Henley Business
School, UK
In order to maximise occupancy and rental income, landlords must attract and
retain occupiers. Therefore landlords and property managers need to understand
what aspects of property management matter most to occupiers. This paper uses
structural equation modelling and regression to analyse 4400 interviews with
retailers, office tenants and occupiers of industrial property, conducted over a 12-
year period. Interval-scale ratings of satisfaction with many aspects of occupancy
are used as explanatory variables. The dependent variables are satisfaction with
property management, value for money, overall occupier satisfaction and landlord
reputation.
Key Findings: For all three asset classes, the aspects with most impact on
occupiers’ satisfaction with property management are found to be
communication, understanding business needs and responsiveness to requests.
For occupiers’ overall satisfaction, the key determinants vary between asset
classes, with ‘Tangibles’, including the form and function of the building, its
location and amenities, being of particular importance to occupiers of industrial
units and offices. Satisfaction with property management, and the professionalism
of the landlord and manager, have an impact on occupiers’ willingness to
recommend their landlord, as does occupiers’ perception of the Corporate Social
Responsibility of the landlord. The accuracy and timeliness of billing and
documentation, and the cleanliness and maintenance of the property, strongly
influence occupiers’ perception of receiving value for money for rent and service
charge. The paper discusses the magnitude and significance of these effects, and
the differences in importance of the explanatory variables for the three commercial
asset classes.
Keywords: Corporate real estate management, landlord - tenant relationship,
occupier satisfaction, property management, reputation
Paper Number:121 Corporate Real Estate
B-2
ERES 2015 Conference 24-27 June 2015 Istanbul 13
PPP as an Alternative Procurement Method for Corporates
Kevin Meyer, TU Darmstadt Department of Law and Economics, Germany
Andreas Pfnür, TU Darmstadt Department of Law and Economics, Germany
Maria Braunschweig, TU Darmstadt, Germany
Real estate, mainly being workspace, is an important resource for non-property
companies and their core business processes, and ultimately influences
productivity. Procurement of such real estate as well as servicing and maintaining
it, incurs extensive capital and operating costs, which in turn have a significant
impact on the company’s performance. Meanwhile, real estate developments very
often show massive overruns in time and budget as well as quality deficiencies.
These inefficiencies pose an enormous risk for the success of a non-property
company. In a pilot project for the first time was investigated to what extent the
PPP-model can meet the complex requirements of a private property user. For
this purpose, the development and the first operating phase of a new headquarter
was scientifically monitored through a mix of qualitative and quantitative research
methods. The results show that a significant reduction of costs and risks is
possible through this innovative procurement method. But the economic
optimization of the building can also lead to a reduction of user-specific qualities,
which may negatively affect productivity and satisfaction of the property user.
Keywords: Corporate real estate, PPP, workplace, real estate development
Paper Number:175 Corporate Real Estate
B-2
14 ERES 2015 Conference 24-27 June 2015 Istanbul
Alignment of Corporate Real Estate and Business Strategy
in a Disrupted Market: Hold and Manage or Sell?
Gheorghe Petru Multescu, School of the Built Environment & Architecture London
South Bank University, UK
Barry Symonds, London South Bank University (LSBU), Symonds Konsult International
Ltd, Chelmsford, UK
Further to the 2008 financial crisis, many financial institutions throughout Europe
have experienced turbulence. Post 2008 economic developments varied widely
across European countries. Some markets returned to growth while distressed
economies continued to affect property markets especially across Central Eastern
Europe. One of the main outcomes of the crisis consisted of banking institutions
holding property assets as a result of defaults. Such property is expensive to hold
and brings increased liabilities, particularly in a distressed property market,
however shifting economic trends offer difficult decision making options.
Business strategies adopted prior to the credit crunch did not necessarily include
a specific Corporate Real Estate dimension, however this situation had to be
adjusted in accordance with political and financial regulations set by the European
Union and the European Central Bank. This has led to financial institutions having
to develop Corporate Real Estate strategies of either having to dispose of build
assets at unacceptable discounts or holding and managing those assets in the
interests of their investors.
The research aims to investigate the issues surrounding the decision-making
process on disposing of or holding onto their “unwanted“ property assets with
specific reference to particular case studies from Central Eastern European
property and financial markets. Specific findings highlight the importance of
adopting a specific strategy to align Corporate Real Estate decisions with the
current business strategy and the most important factors affecting the decision-
making process.
Keywords: Business strategy, central eastern Europe, corporate real estate
strategy, distressed property markets, property asset decision-
making.
Paper Number:304 Corporate Real Estate
B-3
ERES 2015 Conference 24-27 June 2015 Istanbul 15
The Productive Workplace for Knowledge Workers: A
Focus on Workplace Design and Environment across
Various Age Groups
Ana Chadburn, Institute of Real Estate, Kingston University, UK
Judy Smith, Institute of Real Estate, Kingston University, UK
The nature of work has changed and office designers are striving to find the ideal
workplace design that meets the needs of knowledge workers. According to
Thompson and Kay (2008) the issue of productivity is becoming of key interest in
all sectors. In recent years, firms have begun to realise that a workplace
environment that has been well designed is more likely to attract the highest
calibre of worker and reduce staff attrition. (Gensler, 2005). A poorly-designed
workplace can increase stress levels and negatively affect performance. As many
as one- fifth of workplaces in the UK do not provide sufficient work place
environments, and that at least one quarter of staff in the UK logged ‘serious’
complaints about factors such as poor layout, furniture, temperature and noise,
among others (Myerson et al, 2011). Overall, British businesses are still
considerably behind in creating workplaces that optimise employee satisfaction.
(Arup, 2011). Improved workplace design can lead to a productivity increase
Gensler (2005) and Bootle and Kalyan (2002) agree that billions of pounds are
wasted each year due to the unproductive layout and design of some offices.
There is a clear connection between the work environments and office users'
productivity within the workplace. Most studies include the components of
furniture, noise, lighting, temperature and spatial arrangements when considering
that which affects productivity (Hameed and Amjad, 2009). However, there is no
clear consensus as to which factors predominate. Employees of different
generations respond differently to how their workplace environment is designed
(Myerson et al, 2010). Almost 50% of today’s economy is knowledge-based and
more workers are expected to be flexible, creative and communicative, (Greene
and Myerson, 2011). The creation of work environments that result in satisfied and
productive knowledge workers and end users requires information about user
preferences concerning their work environments, and as the nature of work is
changing, there is a need for updated research within this subject. Method: This
paper will be based on research carried out on knowledge workers in 7 substantial
companies within London. Results: Some results are already known and these
include: employees are most productive when under pressure and in a buzzy
environment; colleagues, design of office and quality of IT are the greatest factors
that make employees unproductive.
Keywords: Age groups, employee productivity drivers, knowledge workers,
productive workplace, workplace design and environment
Paper Number:136 Corporate Real Estate
B-3
16 ERES 2015 Conference 24-27 June 2015 Istanbul
Ownership in Real Estate and Stock Market Performance:
Evidence from German Equities
Karim Rochdi, International Real Estate Business School (IRE|BS), University
Regensburg, Germany
While the ownership of real estate constitutes a considerable proportion of most
listed firms’ balance sheet, in the existing literature, whether or not the benefits
outweigh the risks associated with corporate real estate, is the subject of
controversy. In this context, the present paper investigates the repercussions and
impact of corporate real estate on the stock performance of non-real estate
equities in a time-series setting. In particular, the role of corporate real estate
ownership in the pricing of returns is examined, after taking well-documented
systematic risk factors into account. Employing a data sample from 1999 to 2013,
we identify and analyze the conditions and characteristics faced by firms with a
high level of corporate real estate. Since effects might be driven by industry-
related differences, we explore whether the impact of ownership in real estate
varies according to distinct business segments. In view of the significant
difference in the proportion of real estate ownership among listed companies and
the illiquid characteristics of real estate per se, investors demand a real estate or
illiquidity return premium for such ownership. The present paper provides further
insights into the pricing of stock returns, by considering corporate real estate as
a priced determinant. The findings enhance the interpretation of expected general
equity returns and may thus be of particular interest for investors as well as the
management boards of listed companies.
Keywords: Asset pricing, ownership in real estate, portfolio management,
property-intensive, real estate
Paper Number:147 Corporate Real Estate
B-3
ERES 2015 Conference 24-27 June 2015 Istanbul 17
The Energy Efficiency of Corporate Real Estate Assets:
The Role of Professional Management for Corporate
Environmental Performance
Markus Surmann, Metro Properties Holding GmbH, Germany
Wolfgang A. Brunauer, Real(e)value Immobilien BewertungsGmbH, Austria
Sven Bienert, International Real Estate Business School (IREBS) University of
Regensburg, Germany
Despite the rising information about the ecological footprint and greenhouse gas
externalities of corporates' activities only little is known about the energy efficiency
of corporate real estate assets. When considering achievements from the past,
such as significant reduction of carbon emissions and towards carbon
accounting, the energy consumption of corporate real estate assets is of
emerging interest within the sustainability strategy of corporations. On the contrary
to residential and commercial buildings within the real estate industry accessibility
to profound datasets for corporate assets in terms of energy performance is rather
difficult. When employing a unique multi-national dataset of big-box wholesale
buildings obtained from METRO Cash & Carry (MCC) the authors investigate the
relationship between energy consumption, physical building characteristics and
the potential impact of corporate management. The study analyzes the dataset
with electricity and heat consumption in a panel regression to investigate
expected higher levels of energy savings over time. All above insights about
energy efficiency measures of corporate real estate assets within a special asset
class we analyze the contribution of professional management towards a more
efficient corporate environmental performance.
Keywords: Carbon emissions, corporate real estate management, energy
efficiency, hedonic effects, sustainable real estate
Paper Number:160 Corporate Real Estate
B-3
18 ERES 2015 Conference 24-27 June 2015 Istanbul
What is the Real Added Value of Sustainable Office
Buildings? - Initiating a Longitudinal Study
Pieter Le Roux, Department of Design and Planning, University IUAV of Venice, Italy
Pim Brackenie, Real Estate Concept Developer Wood&Apples, The Netherlands
This paper presents initial research outcomes of a longitudinal study which was
initiated in 2013/2014 to determine the real added value of sustainable buildings
for end-users. The focus of this research is on the added value of sustainable
buildings to organisations – specifically the added value thereof to user-
experience, comfort, well-being and perceived performance. The sustainability of
a newly constructed or refurbished office building is often used extensively in
marketing the sustainable goals and ambitions / achievements of organisations.
Being the start of a longitudinal study, the objectives of this research is firstly, to
establish a proper theoretical framework according to which the added value of
sustainable office buildings to both end-users and organisations can be studied,
and secondly, using case studies to validate the theoretical knowledge. The
development and initial research discussed in this paper was executed as a
bachelor graduation project in the IREFM (International Real Estate and Facility
Management) programme at the Academy of Hotel and Facility Management at
the NHTV Breda University of Applied Sciences in the Netherlands. The
methodology employed was based on the development of a theoretical
framework according to literature sources in the field of sustainability and the
impact thereof on end-users and organisations. Subsequent to the development
of the theoretical framework, interviews and questionnaires were used to further
develop the framework for application as a conceptual framework for the
longitudinal study. Preliminary results of the case study indicate that users of
sustainable office buildings are more satisfied and perceive themselves to be
more productive. However, employees still suffer from physical complaints whilst
being in the office building, which indicates that sustainable buildings do not
directly increase physical well-being of employees. For many employees, the
indoor climate is affecting daily tasks, which might result in stressful situations and
therefore in decreased psychological well-being. Although employees feel safe in
the office building and experience enhanced social interaction because of the
available workspace, it can be concluded that overall well-being of employees is
not increased due to sustainable office buildings. The study provides a first-draft
approach to developing a comprehensive framework for longitudinal research into
the real added value of sustainable office buildings.
Keywords: Decision-making, office buildings, performance, satisfaction,
sustainability
Paper Number:1 Green Buildings&Enviromental Policies
C-1
ERES 2015 Conference 24-27 June 2015 Istanbul 19
Capitalization of Residential Energy Efficiency
Erdal Aydın, Tilburg University, The Netherlands
Dirk Brounen, Tilburg University, The Netherlands
Nils Kok, Maastricht University, The Netherlands
The uncertainty regarding the financial return of energy efficiency (EE) investments
may be a reason for households not to undertake profitable investments in energy
efficiency. Therefore, it is important to identify the market value of energy efficiency
in the housing sector. Previous literature provides some empirical evidence on the
impact of energy efficiency on sale prices in the building sector. However, the
most common methodological drawback of the evidence provided by the
available literature is the potential bias that may arise due to the omission of
unobserved dwelling characteristics that are correlated with the EE.
In this study, using a large representative dataset from the Netherlands, we
propose an instrumental variable approach in order to correctly identify the
capitalization of energy efficiency in the housing market. We benefit from a
continuous energy efficiency measure provided by Energy Performance
Certificates (EPC), which enables us to estimate the elasticity of house price with
respect to its energy efficiency. As well as including detailed dwelling
characteristics in the hedonic model, we use an instrumental variable (IV)
approach to deal with the potential omitted variable bias. The 1973-74 oil crisis,
which created an exogenous discontinuity in the EE levels of the dwellings
constructed before and after this date, and the evolution of building codes are
used as instruments for energy efficiency. Our results indicate that the standard
OLS estimates are downward biased. By using an IV approach, we find that as
the energy efficiency level increases by 50 percent for an average dwelling, the
value of the dwelling increases by around ten percent. In order to examine whether
the value of EE increases by the disclosure of EPC, we create a common energy
efficiency measure for certified and non-certified dwellings, which is based on
actual energy consumption. Our findings do not suggest a larger capitalization
rate for the dwellings that are transacted with EPCs. Finally, in order to examine
the over-time variation in the capitalization of EE, we estimate the hedonic model
for each year separately from 2003 to 2011. We document that the value of EE
has doubled from 2003 to 2011, which might be partly explained by the increase
of energy prices, the relative decrease in house prices.
Keywords: Building code, energy efficiency, energy label, house price,
regression discontinuity
Paper Number:5 GreenBuildings&Enviromental Policies
C-1
20 ERES 2015 Conference 24-27 June 2015 Istanbul
Sustainability in Retail Developments: Case of Singapore
Lawrence Chin, National University of Singapore, Singapore
In Singapore, the retail sector is one of the highest consumers of energy per floor
area, with tenants within a retail mall accounting for approximately 50 per cent of
the building’s total energy consumption (BCA, 2013). This reflects the need to
reduce the energy consumption of retail tenants to enhance the mall’s
sustainability, and to lower the carbon footprint of the retail sector in Singapore.
Going green has been adopted in many developed countries such as Australia,
Europe, Canada, and USA. The aim is to encourage both landlords and tenants
to minimize adverse environmental impact, and is widely known as a powerful
mechanism to drive carbon dioxide savings in commercial properties. However,
sustainable developments are a relatively new phenomenon in Singapore.
This study examines how the implementation of sustainability practices and
approaches can contribute to an increase in overall patronage to a mall, and if
shopper characteristics such as their education levels and ethnicities will influence
their perceptions on the need and benefits of sustainability in retail malls.
The results obtained a sample of two malls found that most shoppers are more
incentivized to increase patronage to malls with sustainability practices including
the introduction of green leases.
Keywords: Energy conservation, green leases, retail malls, Singapore,
sustainable developments
Paper Number:17 Green Buildings&Enviromental Policies
C-1
ERES 2015 Conference 24-27 June 2015 Istanbul 21
The Attitudes of Buyers, Vendors, Tenants, and Landlords
Concerning Environmental Questions - an Analysis based
on Different National Empirical Surveys
Stephan Kippes, Department of Real Estate Nuertingen-Geislingen University, Germany
The climate change and an increased awareness of environmental questions have
led to much tougher environmental laws globally. In accordance with the Kyoto
treaty is striving hard to fulfil its environmental obligations.
Increasingly stringent environmental laws and soaring energy prices are therefore
forcing the Real Estate sector to respond. While new buildings must comply with
the new regulations, older buildings need to be upgraded as well; that means
“greening” existing properties becomes a political and commercial priority. When
improvements are necessitated in existing properties, the new regulations force
the owners to upgrade the building to the higher standards.
This paper researches and analyses these environmental issues relevant to the
house buyers, vendors, tenants, and landlords to determine the importance of
sustainable housing to the general public.
The paper is based on a national empirical survey from spring 2005; the paper
also compares and analyses data from six different surveys (from 2009 to 2015)
carried out by the author.
Keywords: Awareness of environmental questions, ecology and real estate,
energy performance of buildings, green building, sustainbility
Paper Number:284 Green Buildings&Enviromental Policies
C-1
22 ERES 2015 Conference 24-27 June 2015 Istanbul
Is Energy Efficiency Priced in the Housing Market? - Large
Sample Evidence from Germany
Marcelo Cajias, PATRIZIA Immobilien AG, Germany
Franz Fürst, University of Cambridge - Department of Land and Economy, UK
Sven Bienert, International Real Estate Business School (IREBS), University of
Regensburg, Germany
The European Union introduced Energy Performance Certificates (EPC) in 2002
to all member states in order to enhance the environmental awareness in the real
estate industry. EPCs act nowadays as a mandatory instrument in investment
decisions when letting or selling new and particularly existing buildings. Empirical
research across the member states has shown over the last years that energy
conservation pays off as the financial benefits might exceed potential investment
costs. Although Germany adopted a strict sustainability agenda to reach a carbon
neutral stock by 2050, evidence about the potential energy premium in the
housing market is scarce. In this paper we investigate the effect of energy
performance measured by EPCs on asking rents in the German housing market
based on a database involving more than 1,000,000 observations. We explore the
relationship extensively between 2013 and 2014 using advanced semiparametric
regression models and provide evidence of a substantial impact of energy
savings on asking rents and thus on the buildings' performance.
Keywords: EPC, generalized additive models, german housing, sustainability,
energy performance
Paper Number:45 Green Buildings&Enviromental Policies
C-2
ERES 2015 Conference 24-27 June 2015 Istanbul 23
The Price Effect of EEWH Certification
Fong-Yao Chen, National Chengchi University, Taiwan, R.O.C.
Jen-Hsu Liang, Chinese Culture University, Taiwan, R.O.C.
Energy depletion and Ecological sustainability are two global-wide issues that
most countries seriously concern about, and construction industry takes a big
share of energy consumption and ecological damage. Therefore, the promotion
of the green building gradually becomes the trend and leads the direction of
national policy. The EEWH (Ecology, Energy Saving, Waste Reduction, Health),
the Taiwanese green building labeling system, was established in 1999.
This article exams the price effect of the green label with hedonic regression
model in New Taipei City, and the result shows that the building certificated with
EEWH gets 8% premium on average. Price premium varies at different levels of
labels, and they are 14.3%, 2.7%, 4.8% and 8% for qualified, bronze, silver and
gold levels. Low-priced areas have significantly higher premium of 16.8%
comparing to the High-priced areas of 4.5%. In terms of space and location, the
buildings in CBD obtain lower green premium than those in outskirts. We believe
higher premium is seen in low-price outskirt area due to the extra marketing green
labels have for these buildings.
Keywords: EEWH green building labeling system, green building, hedonic
pricing model, Taiwan
Paper Number:112 Green Buildings&Enviromental Policies
C-2
24 ERES 2015 Conference 24-27 June 2015 Istanbul
Energy Performance Ratings and House Prices in Wales:
An Empirical Study
Franz Fuerst, Cambridge University Land Society , UK
Pat McAllister, University College London, UK
Anupam Nanda, University of Reading, UK
Peter Wyatt, University of Reading, UK
The aim of this research was to investigate the price effect of EPC ratings on the
residential dwelling prices in Wales. It examined the capitalisation of energy
efficiency ratings into house prices using two approaches. The first adopted a
cross-sectional framework to investigate the effect of EPC band (and EPC rating)
on a large sample of dwelling transactions. The second approach was based on
a repeat-sales methodology to examine the impact of EPC band and rating on
house price appreciation. A concern with hedonic price models is potential
omitted variable bias. In the context of this study, dwellings in higher EPC bands
may have been subject to unobserved improvements that enhance their quality
as well as their energy performance. With this in mind, a series of robustness
checks were undertaken, the main purpose of which was to restrict the sample to
dwellings built relatively recently, and to exclude dwellings that are more likely to
have been improved or that may be unusual in some way – dwellings that have
been re-sold within a short period of time for example.
Paper Number:129 Green Buildings&Enviromental Policies
C-2
ERES 2015 Conference 24-27 June 2015 Istanbul 25
From Green Buildings to a Sustainable Real Estate
Industry - Assessing Five Years of ÖGNI
Gunther Maier, Research Institute for Spatial and Real Estate Economics, WU Wien,
Austria
Sabine Sedlacek, MODUL University, Austria
Philipp Kaufmann, ÖGNI, Austria
In this paper we assess five years of activity of ÖGNI, the Austrian Green Building
Council. About five years ago the organization started off as an activity of two
individuals. In the meantime it has developed into an important actor of the
Austrian real estate industry. The organization has certified over 100 buildings
according to the DGNB system not only in Austria but also in some other
European countries. In addition to that it has developed instruments for
supporting a transition toward sustainability for the real estate sector and related
sectors by taking a more holistic perspective that looks at products, processes
and people. After five years of development, ÖGNI can be considered a success
story that justifies a closer investigation. The analysis of our paper is based upon
information from documents and stakeholders about the historical development
of ÖGNI and of sustainable real estate in Austria and upon a survey of members
of the organization. The paper will investigate, to what extent and in what respects
the five year development of ÖGNI can be considered successful and will identify
the main lessons that can be drawn from this example.
Keywords: Certification, green buildings, organization, sustainability
Paper Number:152 Green Buildings&Enviromental Policies
C-2
26 ERES 2015 Conference 24-27 June 2015 Istanbul
Do Smart Grids Increase Real Estate Market Values?
Chiara D'Alpaos, Department of Civil, Architectural and Environmental Engineering -
University of Padova, Italy
Michele Moretto, Department of Economics and Management - University of Padova,
Italy
Purpose –Buildings energy efficiency is generally considered in terms of energy
consumption, costs and GHG emissions reduction in line with the 2020 goals. It
is commonly agreed that the greater the building energy efficiency, the greater the
property market value. To increase energy efficiency, deep retrofitting was set in
place and simultaneously photovoltaic power plants (PV) were installed, boosted
through feed-in-tariffs that made them extremely attractive for both institutional
and small private investors. Nonetheless Government incentives and regulations
were not able to foster consumers to substantially change their energy
consumption patterns. In this scenario overall cost-savings by PV-generation
systems would only have a marginal impact on real estate market values, if the
energy consumption pattern of the household does not match the most beneficial
generation pattern and energy management is not properly performed. Aim of the
paper is to investigate whether Smart Grids can increase market values due to
higher production and consumption flexibility. Smart grids give de facto producers
and consumers, the opportunity to be active in the market and strategically decide
their optimal production/consumption pattern. We provide a model based on the
real option theory to determine the value of this flexibility and the related market
value increase. Design/Methodology/Approach – We model the homeowner
decision to invest in a PV plant and connect to a Smart Grid. We determine the
property potential market value increase due to the opportunity to perform active
energy management given by smart grids and we compare this value increase to
the PV plant value per se. To capture the value of managerial flexibility we
implement a real option approach. Findings – The paper provides a theoretical
framework to model the owner’s decision to invest in a PV plant, to be integrated
in a smart grid, and determines the real estate market value increase. The greater
the flexibility the greater the market value Research limitations/implications –
Interesting policy implications might be driven from the model implementation. It
might be derived the optimal mix between building energy retrofitting and energy
market participation that increases property values in a smart grid scenario.
Originality/values – The novelty of the paper lies in the attempt to define energy
efficiency also in terms of flexible energy management and its implications in the
energy market.
Keywords: Investment under Uncertainty, real estate market values, real options,
smart grids
Paper Number:51 Green Buildings&Enviromental Policies
C-3
ERES 2015 Conference 24-27 June 2015 Istanbul 27
A Multi Actor Multi Criteria Approach to Evaluate the
Effectiveness of European Policies on Buildings Energy
Retrofit. The Italian Context
Pietro Bonifaci, Department of Design and Planning, University IUAV of Venice, Italy
Sergio Copiello, Department of Design and Planning, University IUAV of Venice, Italy
In recent years the traditional models and tools used by the public sector to attract
private capital into urban regeneration are in crisis, partly due to the economic
situation. At the same time, new paradigms able to capture the interest of private
subjects in regeneration are emerging. One of these, and perhaps the most
interesting for its potential and the growing interest from the European Union, is
the energy retrofit of existing buildings.
According to some studies carried out at European and international level, the
savings on energy bill and the increase of buildings market value not always seem
to be able to justify a redevelopment intervention. A purely financial approach to
existing buildings energy retrofit is thus not sufficient to define the convenience of
such interventions, since stakeholders, social actors and their interests are
multiple and often conflicting. Furthermore policies developed by the European
Union are complex and have to deal with different issues such as environmental
protection, fossil fuel dependence reduction and the incentive of the building
sector.
Therefore, present research aims to analyse the compliance between European
energy policies and stakeholders' goals, using a multi-actor-multi-criteria
approach in order to assess all the aspects that investors and public bodies take
in account in an energy leads redevelopment project. The underlying assumption
can be summarized as follow: in the framework of sustainability and social
policies, the lower the conflict among actors, the greater the effectiveness of the
measures.
European policy measures are classified depending on their nature of economic
incentives or command and control policies. Focusing on the Italian context,
representatives of main stakeholders involved in energy retrofit projects are
identified, asked to weight a common set of criteria (based on their specific
objective) and then to evaluate the compliance between policy measures and their
goals. The weighting of criteria and judgement among policy measures are based
on the fuzzy set theory to model the stakeholders’ subjectivity in the assessment.
A cluster analysis allows identifying policy measures, and subsets of them,
creating fewer conflicts among stakeholders. Results are then compared with the
single judgements expressed by each stakeholder so as to analyse the
relationship between goals optimization and conflict reduction, and to define a
policies ranking based on their effectiveness.
Keywords: Buildings energy retrofit, European energy policies, multi actor multi
criteria analysis
Paper Number:117 Green Buildings&Enviromental Policies
C-3
28 ERES 2015 Conference 24-27 June 2015 Istanbul
Domestic Energy Prepayment and Fuel Poverty: Induced
Self-selection of Housing Characteristics Influencing the
Welfare of Fuel-poor Households
Sotirios Thanos, UCL Energy Institute, UK
Maria Karmagianni, UCL Energy Institute, UK
Ian Hamilton, UCL Energy Institute, UK
Prepayment meters are normally installed in the UK to address the risk of non-
payment from overindebted households and the literature shows a discrepancy
of higher energy prices in prepayment meters. This research seeks to understand
the spatial aspect of this sorting process, where prepayment meters and higher
energy prices are concentrated in the areas of higher fuel poverty. A corollary
research question is whether this sorting affects aspects of the consumption of
housing services with respect to structural and neighbourhood characteristic.
State-of-the-art latent class discrete choice models (LCM) are employed on the
choice of prepayment to standard payment meter. LCM approach identifies
unobservable subgroups within the population and the housing stock, allowing
better understanding the impact of exposure to patterns of multiple risks, as well
as the antecedents and consequences of complex behaviours. Therefore,
interventions can be tailored to target the subgroups that are affected most; in this
case, households vulnerable to fuel poverty affected by market failures that lead
to adverse self-selection.
Keywords: Discrete choice models, energy prices, fuel poverty, housing
services, sorting
Paper Number:176 Green Buildings&Enviromental Policies
C-3
ERES 2015 Conference 24-27 June 2015 Istanbul 29
Efficient Measures for Energetic Retrofit–an
Interdisciplinary Case Study of Representative Housings in
Germany
Nikolas D. Müller, TU Darmstadt Department of Law and Economics Germany
Andreas Pfnür, TU Darmstadt Department of Law and Economics Germany
The discussion about energy refurbishments is defined by high complexity. If
house owners or policy makers have to identify appropriate energy standards for
their buildings or the existing stock, various aspects of different disciplines (e.g.
economics, ecology, building physics, architecture, ...) have their place and must
taken into account. The amount of disciplinary studies on the effects of energetic
retrofits grows steadily, and every discipline proofs their numbers continuously.
Nevertheless, in disciplinary research, interdependencies between the various
relevant aspects of the involved disciplines remain open. This paper aims to
reduce the complexity by creating transparency as well as to identify particularly
efficient measures for the residential refurbishments. In a case study on exemplary
residential buildings, different measures of energetic retrofitting are analyzed in
terms of their impact on various aspects, which are relevant to diverse disciplines
(i.e. temperature effects, GWP, incremental costs for energy savings,). The
identified effects show in detail the efficiency of different measures as well as their
reciprocal interactions. Hence, the results provide both a guideline of beneficial
measures of energetic refurbishments and a useful sequence order for house
owners. Further, a transparent basis for policy implications about future levels of
legal requirements for energy usage of buildings and funding instruments for
energy reduction to each other.
Keywords: Green and sustainable building, energetic retrofit, energy efficiency of
real estate, energy policy for real estate, incremental costs for energy
savings
Paper Number:231 Green Buildings&Enviromental Policies
C-3
30 ERES 2015 Conference 24-27 June 2015 Istanbul
Measuring Instrument Constructs for Green Office Building
Investments Variables Using Rasch Measurement Model
Megat Mohd Ghazali Megat Abdul Rahman, Department of Real Estate,
University Technology Malaysia, Malaysia
The aim of this paper is attempt to introduce the application of Rasch
measurement model analysis to determine the validity and reliability of each
construct in the questionnaire. In achieving this objective, a questionnaire survey
was developed consists of 6 sections and a total of 106 responses were received
from various investors who owned and rent office buildings in Kuala Lumpur. The
Rasch Measurement analysis is used to measure the quality control of item
constructs in the instrument by measuring the specific objectivity within the same
dimension, to reduce ambiguous measures, and a realistic estimation of precision
and implicit quality. The Rasch analysis consists of the summary statistics, item
unidimensionality and item measures. A result shows the items and respondent
(person) reliability is at 0.91 and 0.95 respectively.
Keywords: Green office building investment, rasch measurement model,
instrument constructs, validity and reliability
Paper Number:11 Green Buildings&Enviromental Policies
C-4
ERES 2015 Conference 24-27 June 2015 Istanbul 31
An Investigation into the Strategic Importance of GBFIs
within the Listed Property Market
Saul Nurick, University of Cape Town, South Africa
Alexandra Morris, University of Cape Town, South Africa
Jody Schofield, University of Cape Town, South Africa
Purpose - The purpose of this paper is to investigate the level of importance that
green building features and initiatives (GBFIs) have with regards to decision
strategies in the South African listed property market.
Design/methodology/approach - The paper extrapolates qualitative data in the
form of a multiple case study analysis as the overarching research methodology.
Three South African real estate investment trusts (REITs) participated in the
research. Pattern matching in conjunction with semi-structured interviews was
implemented to determine whether patterns in the literature could be matched to
the empirical data.
Findings - It was found that each REIT is at different stages with regards to the
implementation of GBFIs, thus relating to the decision strategy adopted by each
REIT. The strategies applied had different drivers; either to reduce costs or to gain
a competitive advantage in local and international markets. REITs that had been
implementing GBFIs for a longer period of time were found to have more
advanced strategies and a higher degree of GBFI consideration in their decision
strategies. The main conclusion revealed that there is a range with regards to the
level of how reactive/proactive of each of the three participating REITs in terms of
their decision strategies with specific reference to GBFIs. This is mainly due to the
fact that green building is still in its infancy in the South African property market,
thus resulting in delays regarding the full implementation of GBFIs in the South
African listed property market.
Research limitations/implications - This paper is indicative and highlights a
number of issues surrounding the decision strategies in the listed property market
with regards to the level of implementation of GBFIs. There is scope for a more
comprehensive investigation by increasing the number of cases, so as to reduce
interpretation of the results as generalizable.
Practical implications - The findings indicate a broad spectrum in the level of
integration of GBFIs in the decision strategies with the South African listed
property market. The level of integration is dependant on when a particular REIT
started implementing GBFIs. Those REITs that were proactive in implementing
GBFIs into their portfolio are starting to accrue benefits that are resulting in a
competitive advantage.
Originality/value - This is the first paper to investigate the role GBFIs play in the
decision strategies in the South African REITs.
Keywords: Decision strategies, Green building features and initiatives s (GBFIs),
Real estate investment trusts (REITs)
Paper Number:76 Green Buildings&Enviromental Policies
C-4
32 ERES 2015 Conference 24-27 June 2015 Istanbul
Is Energy Performance too Taxing?
Michael McCord, University of Ulster, UK
John McCord, University of Ulster, UK
Peadar Davis, University of Ulster, UK
Martin Haran, University of Ulster, UK
Over the past decade, there has been an increasing policy focus on improving
the environmental performance of the housing stock. Following the Kyoto
Protocol, the reduction of energy consumption attributable to buildings is a key
Government policy objective. The housing sector has therefore observed a
paradigm shift with increasing emphasis on energy efficient housing becoming a
new orthodoxy. A side effect of this has been the mandate for ‘compulsory’ Energy
performance certificates (EPCs) as new laws are promulgated relating to the need
to conform with energy performance levels. As from 2018, all properties with EPC
levels F and G will not be ‘lettable’ and this is likely to be extended to properties
for sale. With increasing utility costs to customers, purchasers and authorities are
becoming increasingly concerned with the running cost of properties and whether
property energy improvements will be capitalized into sale value. Indeed, how
energy efficiency is valued in the residential property market in terms of resale or
appraisal value is a growing concern (McNamara, 2008; Sayce et al., 2010).
Notwithstanding this, the relationship between energy performance and property
value remains nebulous, complex and under-researched. In Europe, few studies
investigate the effect of energy performance rating on residential property value
with limited information and research in the UK and Northern Ireland context. This
research uses hedonic analysis to investigate the relationship between EPCs and
property sale price within the Belfast housing market. The findings show that there
is a positive statistically significant relationship – however, this is complex and
subject to omitted variable bias and endogeneity problems. In addition, there
appears to be a rural urban divide with regards to where policy should target. We
further develop a multiplicative model (CAMA) to assess the energy performance
of properties across NI using CO2 kg m2. The results show that introduction of a
‘green’ tax may indeed help foster behavioural change, but is in no way a
panacea.
Keywords: Energy performance, green tax, mass appraisal
Paper Number:133 Green Buildings&Enviromental Policies
C-4 Poli
ERES 2015 Conference 24-27 June 2015 Istanbul 33
Impact of Indoor Environmental Quality and Innovation
Features on Residential Property Price and Rent in
Malaysia: a Review
Megat Mohd Ghazali Megat Abdul Rahman, Department of Real Estate,
University Technology Malaysia, Malaysia
Maryanti Mohd Raid, Department of Real Estate, University Technology Malaysia,
Malaysia
Asmma' Che Kasim, Department of Real Estate, University Technology Malaysia,
Malaysia
Khadijah Hussin, Department of Real Estate, University Technology Malaysia, Malaysia
Green building concept, a trend in developed nations, has spread to Malaysia.
The green features improve the functions of buildings and promises higher
returns. Indoor environmental quality (IEQ) and Innovation (IN) are among six
criteria of Green Building Index (GBI) that building owner needs to attain for its
building to be certified as ‘green’ in Malaysia. The benefit of IEQ is to create
conducive indoor environment for building occupants for living and working. While
IN is to meet the objectives of GBI through green building design initiatives and
sustainable construction practices. The research question is does IEQ and IN
features give direct impact to residential property price? Therefore, this paper will
review the broad literature regarding the impacts of indoor environmental quality
(IEQ) and innovation (IN) for residential property and its implication to market price
and rent. The early hypothesis of this paper anticipate that innovation (IN) and
indoor environmetal quality (IEQ) features will indirectly increase residential
property market price and rent in spite of the lack of comparative financial data.
From this paper, it is hope that the positive impacts of these features will
encourage building owners, developers and other main development actors to
put these criteria into the same consideration as other criteria in GBI as one of the
way to compensate the impact of the building towards economic, environment
and social features.
Keywords: Green building Index (GBI), green building features, indoor
environmental quality, innovation, property price and rental
Paper Number:154 Green Buildings&Enviromental Policies
C-4
34 ERES 2015 Conference 24-27 June 2015 Istanbul
Location, Location, Green. A Spatial Analysis of Green
Buildings in Europe?
Costin Ciora, The Bucharest University of Economic Studies (ASE), Romania
Gunther Maier, Research Institute for Spatial and Real Estate Economics, WU Wien,
Austria
Ion Anghel, The Bucharest University of Economics Studies (ASE), Romania
The high spread of green building certification across Europe has become more
visible with the new projects that have been built in the last five years. Our main
research focus is on the location of green buildings within European cities. We
argue that green buildings should cluster in a specific distance from the Central
Business District (CBD). Taking into consideration the urban development of cities
and specific characteristics of the CBD, our aim is to analyze empirically whether
or not this hypothesis is supported by data from European cities.
We will use publicly available data for various green building certificates (LEED,
BREEAM, DGNB) which give addresses or coordinates for certified buildings and
will combine this information with GIS-based information for the respective cities.
We will use point pattern analysis in order to find spatial clusters of project in the
various cities and relate these results to distance from CBD as well as some basic
city characteristics.
Keywords: Green buildings, location
Paper Number:2 Green Buildings&Enviromental Policies
C-5
ERES 2015 Conference 24-27 June 2015 Istanbul 35
Public-Private Partnership, Buildings Energy Efficiency and
Social Housing: Renewed Tools to Satisfy Emerging
Needs. Empirical Findings from a Comparative Analysis of
Italian Experiences
Sergio Copiello, Department of Design and Planning, University IUAV of Venice, Italy
Pietro Bonifaci, Department of Design and Planning, University IUAV of Venice, Italy
To deal with the recession of the global economy since 2008, the financing of
programs relating to strategic infrastructure and facility could provide a significant
boost to a renewed growth. Despite this perspective, the conditions of public
finances, especially in the EU countries, allow recourse to government intervention
only in exceptional and temporary basis. Owing to the limited availability of public
funds, the further diffusion of Public-Private Partnership (PPP) appears to be a
viable strategy to implement investment projects. Nevertheless, in the Italian
context as in other parts of Europe, the PPP initiatives have been progressively
slowed down, over the past few years, by unfavorable conditions emerged in
capital markets.
The framework outlined so far is further complicated by the changing needs
expressed by community. During the recent past, concessions and project
finance have been extensively used to build and manage transport infrastructure
and hospitals. Since the past few years new priorities are emerging, such as the
refurbishment of social housing stock, the supply of new homes at prices or rents
affordable for low income households, as well as the rehabilitation of public
buildings intended for administrative offices or schools. Aim of present research
is to examine whether buildings energy efficiency measures positively affect the
feasibility of social housing projects. This implies the need to investigate the extent
of the savings on operating costs, achievable with interventions targeting the
buildings energy efficiency, and the contribution they are able to provide to the
viability of Public-Private cooperation projects, especially in the field of social
housing. Therefore, a case study analysis is performed by comparing a number
of ongoing experiences in major cities of northern Italy.
Empirical findings highlight structural changes concerning the partnership model.
First of all, a new group of players emerges. Interventions are no longer promoted
by construction companies or by facility management ones. The new
stakeholders are bank foundations and real estate investment funds. Furthermore,
public contribution's forms are reinventing themselves, with a reduced incidence
on the investments. Within this framework, the achievement of high energy
efficiency standards appears to be a relevant feasibility driver for interventions
designed to satisfy social housing needs, particularly those to be implemented by
means of PPP.
Keywords: Buildings energy efficiency, public-private partnership, social housing
Paper Number:282 Green Buildings&Enviromental Policies
C-5
36 ERES 2015 Conference 24-27 June 2015 Istanbul
Discrepancies on Comunity-level GHG Emissions
Inventories
Rogerio Santovito, Universidade de São Paulo, Brazil
Alex Abiko, Universidade de São Paulo, Brazil
Sven Bienert, IREBS International Real Estate Business School, Germany
Over the last decades, greenhouse gas (GHG) emissions have grown at an
increasing rate, which is likely to continue on the long-term trend. These emissions
must be significantly reduced to avoid the worst impacts of climate change. As
the world becomes more urbanized, cities stand at the forefront of efforts to
achieve this goal. GHG emissions flow in and out of the administrative and
geographical limits of a city, and interdisciplinary information is needed to pursue
low-emission urban development strategies. Existing GHG inventory tools and
procedures favor scaled-down estimations and direct emission sources. Policy
makers cannot rely on scaled-down data from national GHG inventories to take
action on a neighborhood level. As the geographic coverage of a GHG inventory
gets smaller, emission activities that occur within the defined boundaries are
intrinsically interconnected with ‘out-of-bound’ areas. In this case, accounting for
emissions occurring outside a neighborhood is not an option, but a requirement.
This paper presents a comparison among existing GHG emissions tools and
methodologies, focusing on the problems that arise when using top-down
Emissions factors to calculate indirect emissions.
Keywords: Greehouse gases, inventory, neighbourhood, urban sustainability
Paper Number:111 Green Buildings&Enviromental Policies
C-5
ERES 2015 Conference 24-27 June 2015 Istanbul 37
The Value Contribution of Sustainability Reporting - an
Empirical Evidence for Real Estate Companies
Nelufer Ansari, IREBS International Real Estate Business School, Germany
Marcelo Cajias, PATRIZIA Immobilien AG, Germany
Sven Bienert, IREBS International Real Estate Business School, Germany
Sustainability has evolved to one of the major challenges for society and business
world. This changing perception over the past two decades resulted in increased
requirements for corporate sustainability. In order to meet stakeholders’
informational desires the documentation of the corporate contribution to
sustainability becomes an important aspect of companies’ stakeholder
communication. Especially the real estate industry bears high responsibility since
this branch is assumed to be one of the major triggers of the anthropogenic
climate change and resource exploitation making sustainable corporate
management and the communication thereof inevitable. The Global Reporting
Initiative (GRI) as the leading authority in sustainability reporting published a
globally recognized common framework in order to ensure the comparability and
standardization of corporate sustainability reporting. This paper analyses for the
first time whether sustainability reporting has an influence on the stock prices of
real estate companies. Using the methodology of event study, the research for a
global sample (Europe, USA and Australia) shows a clear positive impact. Thus,
sustainability and the communication thereof have an impact on corporate
valuation, making efforts to promote corporate sustainability not stamped as
altruism. In fact, sustainability is of decision relevance for shareholder and
investors and therefore a success factor for companies. The results of this study
provide the empirical evidence for listed real estate companies.
Keywords: Corporate performance, GRI CSRevent study, sustainability reporting
Paper Number:237 Green Buildings&Enviromental Policies
C-5
38 ERES 2015 Conference 24-27 June 2015 Istanbul
An Integrated Optimization Model for Capital Allocation of
Energy Efficiency Measures of Existing Buildings: A Case
Study of Bogazici University Kilyos Campus
Brian (Tony) Ciochetti, University of Texas, USA
Mehmet Emre Çamlıbel, Soyak Holding, Turkey
Buildings are responsible for more than a third of global energy consumption, and
emit nearly 40% of all CO2 emissions. A small, but growing body of literature seeks
to identify and isolate methods which may be employed in order to reduce the
energy consumed in the operation of these structures.
In this study, we develop a decision-making algorithm to mitigate the uncertainty
of financial and environmental factors related to energy improvements of existing
buildings, and how to efficiently allocate available funds in order to undertake such
improvements. We develop a case study, in which forty two energy efficiency
measures (EEM) are identified within the existing buildings of a University campus
in Turkey. The operations of the buildings are analyzed, and energy consumption,
energy costs and carbon emissions are measured. Costs and savings of these
specific EEMs are calculated as are a number of their possible combinations. Of
the more than four trillion possible combinations of energy improvement
packages, the ones providing the greatest savings per unit of investment are
computed for a range of limited investment budgets. This optimization problem is
solved through the uses of both a Mixed Integer Programming (MIP), and a
custom developed heuristics model.
Our findings suggest that over the optimized investment curve, the most efficient
use of EEM capital occurs withing a very tight range of allocation, providing the
greatest returns in terms of energy savings, energy costs and carbon emission.
Retrofitting of existing buildings with an optimized investment budget appears to
be a viable investment strategy, providing yearly savings of 33% in energy use,
22% in energy cost and 23% in carbon emission. Our results show that a decision-
maker can comfortably use a less sophisticated heuristics approach, which only
minimally deviates from an exact MIP solution. Finally, we compare optimized
solutions for retrofitting existing buildings against alternative investments of
building new energy production plants and demolishing and re-constructing new
buildings. In both cases retrofitting proved to be significantly more efficient in
terms of investment cost, energy savings and CO2 reduction.
Keywords: Carbon emissions, energy efficiency measures, mixed integer
programming, sustainability
Paper Number:100 Green Buildings&Enviromental Policies
C-6
ERES 2015 Conference 24-27 June 2015 Istanbul 39
Longevity of Buildings as an Economic KPI
Peter de Jong, Delft University of Technology, The Netherlands
In the medical field a vast literature has investigated on correlation between
longevity and economic welfare. The debate is going on researching for attributes
contributing to these KPI’s. On international level longevity-convergence is
evident. Countries with modest longevity levels experience life expectancy gains
in the last 50 years than countries with a higher starting level. The purpose of this
paper is to set up an international data and methodological context for the building
industry to investigate if and to what extent longevity of buildings is also a KPI for
real estate, adding to economic performance on different levels.
The research approach starts with the definition (regression) of the changing
relation between income and longevity for given moments in time (actual and a
base year in the past). Followed by monetising the value of longevity gains by
converting them into income value. This will enable the possibility to express
different causes of demolition (technical underperformance, replacement,
functional obsolescence) into reduction of income value. With buildings the
question of longevity will always against which cost. Total life cycle cost spanning
sequential economic (or technical) lifetimes, including cost of refurbishment and
renovation, next to initial cost and maintenance, are added to the analysis.
The first finding which is aimed for is the confirmation that life expectancy of
buildings is a similar important dimension of welfare as life expectancy of people.
Secondly to put a value to longevity, and finally valuing demolition as an opposite
of adaptive reuse.
There is rich data on the macroeconomic part of the equation through several
international institutions. The research limitation, and challenge for cooperation,
lies in the data collection of life expectancy for buildings on a comparable level.
Dutch data reveals an approach for actual life expectancy of buildings. A base life
expectancy must be constructed. Within this dataset it is possible to test the
methodology for different Dutch cities, but the reflection on macroeconomic KPI’s
requires international comparison, for which ERES is the ideal platform.
Mirroring a debate and a methodology of another field of science is not original in
itself, but the effect is. In the minds of real estate people and politicians a new
build CBD is a sign of desirable prosperity. However a sound mix of old and new
can be found in many mature capital cities. The social and practical
Keywords: International comparison, LCC, life expectancy, longevity, valuing
causes of demolition
Paper Number:122 Green Buildings&Enviromental Policies
C-6
40 ERES 2015 Conference 24-27 June 2015 Istanbul
How Regulation Affects Innovation: The Smart Grid Case
at Urban Scale
Valentina Antoniucci, Department ICEA Civil, Architectural and Environmental
Engineering, Universty of Padova, Italy
Chiara D'Alpaos, Department ICEA Civil, Architectural and Environmental Engineering,
Universty of Padova, Italy
Giuliano Marella, Department ICEA Civil, Architectural and Environmental Engineering,
Universty of Padova, Italy
Purpose: The paper discusses energy saving policies implemented in Italy in the
last ten years and shows their ineffectiveness in promoting innovation in new
energy systems, such as Smart Grids.The economic fundamentals involved in
energy consumption are investigated with specific reference to high rise – high
density settlements and their prevalent building typology, i.e. tall buildings. The
paper discusses how the energy demand and consumption of a single building
can affect the energy trade-off of entire cities.
Approach: We examine current local and national policies- for energy
consumption reduction, then we discuss how Italian urban planning should adopt
ad hoc regulation in order to pursue innovative systems of energy saving. We also
- debate on the present absence of procedures to evaluate these policies’ effects
on market demand in both new building construction and deep energy retrofit.
Finally we argue the inadequacy of Italian national and local legislation in
promoting Smart Grids as innovative systems of electric energy production,
distribution and consumption.
Findings: We represent the stat of art in the Italian legislation for energy saving
and we offer a theoretical framework to verify the effectiveness of these measures.
Furthermore we propose a new way to promote innovative systems of energy
production for high density settlements. In this respect, due to technological and
facility management characteristics tall buildings are an opportunity to experiment
smart grids at neighborhood level. Beyond the construction engineering
advances, we present how regulation should help to improve innovation.
Research limitations/implications: The paper is mainly exploratory and identifies
some issues for further research. Data on housing market demand related to
public incentives must be collected to measure the effectiveness of local norms.
Furthermore, selected case studies must be investigated to verify the energy
demand at diverse urban density: this survey is preliminary to the definition of
protocols for both technological and regulatory interventions.
Originality/values: The paper is the first attempt in Italy to present the role of town
planning norms in the promotion of Smart Grids and, in general, to match
innovative distributed energy systems to legislation in planning. Furthermore the
present contribution highlights the potential of specific building typologies, e.g.
tall buildings, in the promotion of Smart Grids.
Keywords: Energy saving, skyscrapers, smart grids, sustainability, urban
planning
Paper Number:183 Green Buildings&Enviromental Policies
C-6
ERES 2015 Conference 24-27 June 2015 Istanbul 41
The Role of Urban Parks in Cities’ Quality of Life
Sandra Vieira Gomes, ESAI - Escola Superior de Actividades Imobiliárias, Portugal
Teresa Florentino, ESAI - Escola Superior de Actividades Imobiliárias, Portugal
The concerns on the preservation of the natural environment have focus mainly
on large ecosystems protection. These areas are usually distant from the urban
environment, where only relatively smaller natural spaces can survive. These
small-scale green areas are often disregarded, when compared with the large
ones, and many of their benefits are diminished. However, the urban nature
provides important social and psychological benefits to human societies, which
enrich human life. They provide spaces for social interaction, enhancing the
community cohesion, while contributing for a healthier lifestyle. Another
advantage is related to the air quality improvement and climate protection due to
their ability to store carbon.
Although public preferences for environmental attributes may vary among
individual citizens according to their socio-economics characteristics and daily
activities, these benefits are well recognized by most citizens, having clear
consequences on housing choices. Furthermore, green spaces may be used as
factors to increase the attractiveness of a city, by making the city green and
pleasant.
The main concern of this paper is to address the importance of green areas for
the urban citizens, and to analyze their distribution in consolidated cities. A case
study for the city of Lisbon, Portugal is presented, where spatial distribution,
distance from residential areas and population satisfaction is analyzed, amongst
other indicators.
Keywords: Air quality, quality of life, urban parks
Paper Number:186 Green Buildings&Enviromental Policies
C-6
42 ERES 2015 Conference 24-27 June 2015 Istanbul
Fundamental Value of Distributed Photovoltaic Energy
Production around the World
Philippe Bélanger, Département de Finance, Assurance et Immobilier Faculté des
Sciences de l'administration, Université Laval, Canada
Background – Photovoltaic (PV) panels are an important component of passive
and positive energy buildings. The value of the PV depends on the price of the
electricity and on the quantity of energy produced. PV investors does not want to
maximize the quantity of energy produced but the cash flow generated by the
electricity produced. Electricity prices are cyclical, so is they depends on the time
of the days and on the day of the year. Electricity prices are different around the
globe, so are solar radiation. The optimum combination of high price and high
radiation is not easy to find. The best locations to install PV panel are locations
where radiation and prices combination merge together to create the maximum
value.
Purpose – This paper intend to present a method that integrate weather data and
market price dynamic in order to find the fundamental value of distributed PV
production. In a second time, we use this approach to find the fundamental value
of distributed PV production around the globe for 30 locations and 60 different
climate readings.
Design – We use standard weather data from two sources. These data source
give information about the radiation available for each hour of the year. We use
historical electricity price data and official authority forecast to forecast the future
electricity price path. We then optimize the position of the PV panel in order to
achieve the higher present value of the energy sold over the life cycle of the PV
panel, including standard technology decay. This optimum positioning maximize
the cash flow generated by PV panels and therefore should be considered as PV
fundamental value.
Results – As of now, results are preliminary but at the time of the conference, we
will have the fundamental value for each location. We already know that some
location among the best location are surprising.
Limitations / implications – Electricity price data source quality are not the same
for each jurisdiction. Future energy price is a combination of historical price, for
the hourly price pattern, and official forecast, for growth rate path. Obviously the
results are dependent on their reliability.
Practical implications – Investors choice of investment and policy maker decision
can be impacted by the results.
Originality / Value – We analyze the fundamental value for a number of locations.
Second, we analyze the robustness of the result obtain with different data sources.
Keywords: Distributed photovoltaic, electricity prices, real estate, weather
Paper Number:12 Housing Markets & Economics
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ERES 2015 Conference 24-27 June 2015 Istanbul 43
The Consequences of the Demographic Change on the
Demand for Personal Living Space in Germany
Philipp Deschermeier, Research Unit for Real Estate Economics Cologne Center for
Economic Research, Germany
Demographic change is dramatically transforming the German society: the ratio
of young to old and of the gainfully employed to pensioners is shifting in favor of
older persons. In the coming decades this development causes a substantial
macroeconomic structural transfor-mation affecting all of the important markets in
Germany. For example the labor market will lack young workers, the product
markets will have to adjust to structurally changed consumer demands and on
the capital market, savings behavior and the demand for productive in-vestments
will be changing. With respect to the real estate market the change in the age
structure and the regional distribution of the population will affect the demand for
personal living space.
Besides the macroeconomic dimension, the demand for personal living space is
determined by social factors (e.g. more “living apart together” relationships
increase the demand for smaller flats in the metropolitan areas), demographic
factors (old people demand other hous-ing as young) and individual preferences
(buying vs. renting properties). The research pro-posal aims at providing forecasts
of the age specific demand of personal living space for Germany until 2030. The
analysis will use data of the German Socio-Economic Panel, a lon-gitudinal panel
dataset of the population in Germany. The analysis will feature a functional data
model with time series coefficients, which are used to model the age-specific
demand for living space. This model will be forecasted up to the year 2030. The
results provide an insight on the challenges of the demographic transition in
Germany with respect to the real estate market. The presentation will focus
especially on the economic consequences of the aging society in Germany on
the demand for personal living space.
Keywords: Germany, demography, forecasting, personal living space
Paper Number:35 Housing Markets & Economics
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44 ERES 2015 Conference 24-27 June 2015 Istanbul
Who Gets a Reverse Mortgage? Identifying Household
Level Determinants of U.S. Reverse Mortgage Choices
Stephanie Moulton, John Glenn School of Public Affairs Ohio State University, USA
Donald Haurin, Department of Economics Ohio State University, USA
Wei Shi, Department of Economics Ohio State University, USA
Mike Ericksen, Department of Finance Texas Tech University, USA
Internationally, there is increasing interest in the potential of elderly households to
withdraw their home equity, but remain in their home, through some form of
reverse mortgage. However, reverse mortgage markets are limited to the U.S. and
South Korea. One question is whether seniors will originate reverse mortgages if
the contract and process are well documented, the mortgage is insured and
relatively riskless. If seniors are willing to tap home equity through this mechanism,
then the potential for growth in the reverse mortgage market is very large in both
the U.S. and world.
However, very little is known about the characteristics of those who obtain reverse
mortgages in the U.S. compared with the general population of seniors. The
penetration rate is only about two percent. Our study helps address this deficiency
through the analysis of a unique data set of senior households who sought
counseling in 2010 and 2011 for the predominant form of reverse mortgages, the
government insured Home Equity Conversion Mortgage (HECM). We combine
data on counseled households with weighted nationally representative data from
the 2010 wave of the Health and Retirement Study. Our estimation model focuses
on two decisions: seeking counseling (which is a prerequisite for applying for a
reverse mortgage) and obtaining the mortgage. We use a truncated bivariate
probit model for the estimation. We find that household income, home equity, race
and prior credit performance are associated with the probability of obtaining a
reverse mortgage. Specifically, the largest demand for reverse mortgages is
among seniors who have high home equity but a low income flow. Seniors who
were past due on their previous mortgage also have a relatively high probability
of seeking a reverse mortgage; however, counseling tends to moderate this
demand. In general, the required counseling session tends to increase the
probability that credit worthy households apply for reverse mortgages, reducing
the probability for seniors with a poor credit history. We exploit an exogenous
change in counseling requirements and find that enhanced counseling is
associated with a reduced likelihood of obtaining a HECM, and that this effect is
largely explained by information provided about eligibility for alternative public
benefits.
Keywords: Counseling, mortgage choice, reverse mortgage, senior housing
Paper Number:294 Housing Markets & Economics
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ERES 2015 Conference 24-27 June 2015 Istanbul 45
Developer Charges and Housing Affordabilty in Brisbane,
Australia
Lyndall Bryant, Queensland University of Technology, Australia
Purpose - This paper empirically examines the effect of developer charges on
housing affordability in Brisbane, Australia. Developer paid fees or charges are a
commonly used mechanism for local governments to pay for new urban
infrastructure. Despite numerous government reports and many years of industry
advocacy, there remains no empirical evidence in Australia to confirm or quantify
passing on of these charges to home buyers. Design/methodology/approach -
This research applies a hedonic house price model to 4,699 new and 25,053
existing house sales in Brisbane from 2005 to 2011.
Findings – The findings of is research are consistent with international studies that
support the proposition that developer charges are over passed. This study has
provided evidence that suggest developer charges are over passed to both new
and existing homes in the order of around 400%.
Research limitations/implications - These findings suggest that developer charges
are thus a significant contributor to increasing house prices and reduced housing
affordability.
Practical/Social Implications: By testing this effect on both new and existing
homes, this research provides evidence in support of the proposition that not only
are developer charges over passed to new home buyers but also to buyers of
existing homes. Thus the price inflationary effect of these developer charges are
being felt by all home buyers across the community, resulting in increased
mortgage repayments of close to $1000 per month.
Originality/value - This is the first study to empirically examine the impact of
developer charges on house prices in Australia. These results are important as
they will inform governments on the outcomes of growth management strategies
on housing affordability, providing the first evidence of its kind in Australia.
Keywords: Developer charges, growth management, house prices, housing
affordability, impact fees
Paper Number:187 Housing Markets & Economics
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46 ERES 2015 Conference 24-27 June 2015 Istanbul
Behavioural Biases in the Acquisition of Multiple Properties
by Owner Occupier Investors during the Irish Residential
Real Estate Bubble
Clare Branigan, University College Dublin, Ireland
Paul Ryan, University College Dublin, Ireland
Ireland’s economic crisis has its roots in a housing bubble that collapsed in 2007.
This paper examines the behaviour of Irish people who purchased one or more
residential properties for investment purposes prior to the global financial crisis in
2007. During the period that constituted Ireland’s residential property bubble,
many people were not satisfied with acquiring a house solely as a dwelling and
doubled their bets by acquiring other properties for investment purposes. In many
cases the prices paid for these properties were uneconomical vis-a-vis the rental
income stream associated with them. In the case of overseas properties many
investors made purchase decisions without even gathering the most basic
information on the suitability of these properties as potential investments. We
consider the behavioural and psychological factors that drove Irish residents in
the acquisition of one or more residential property for investment both in Ireland
and within the continent of Europe, North America and South Africa.
The biases we examined were, Representativeness, Overconfidence and
Availability. We find evidence that due to the representativeness heuristic,
investors may have been over-extrapolating the past growth into the future. In
addition, lenders also over-extrapolated the increase in house prices and made
credit easily available, largely financed by deposits from financial institutions in
other euro area countries. People over estimated the precision of their forecasts,
when for example, in an effort to estimate an asset’s value, they become
overconfident about the usefulness of this information gathered for this purpose.
For example, groupthink and media cheerleading whereby only favourable
information and positive news in relation to real estate values was reported in the
media despite a series of international reports, including those from the OECD
and the IMF, warning that property values were too high based on economic
fundamentals. Such asymmetric media reporting may have exacerbated investors
overconfidence leading them to see property as a one way bet which in turn leads
them to push the price of the asset higher with upward price movements
becoming a self-fulfilling prophecy. (Daniel, Hirshleifer, Subrahmanyam, 1998). In
terms of Availability, the Irish media were almost without exception cheerleaders
for the booming property market, only dampening their enthusiasm months after
prices had started to decline in late 2007.
Keywords: Behavioural drivers, Ireland, financial crisis, housing bubble,
residential property
Paper Number:132 Housing Markets & Economics
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ERES 2015 Conference 24-27 June 2015 Istanbul 47
The Impact of the Mortgage Interest and Capital
Deduction on Belgian Borrowing Behavior
Annelies Hoebeeck, Ghent University, Belgium
Carine Smolders, Ghent University, Belgium
In 2005, a system of mortgage interest, insurance premiums and capital
deduction (MICPD) was introduced in Belgium to replace and simplify the
previous system of fiscal housing benefits. Mortgage interest, capital
amortizations and insurance premiums were assembled into one single deduction
package. Although previous research has shown that the MICPD did not promote
home ownership, we show in this paper that the MICPD did affect the mortgage
market. The Household Finance and Consumption Survey is used to investigate
the impact of the MICPD on the borrowing behavior of the Belgian households. A
probit analysis is used to model the probability of holding mortgage debt.
Mortgage demand, mortgage terms and housing consumption are estimated
simultaneously in a 3-SLS approach. The results indicate that the fiscal benefit of
the MICPD has induced households to modify their mortgage amounts and terms
to maximize the fiscal advantage of the MICPD, rather than inducing them to take
out a mortgage. Furthermore, we find that couples and financially unconstrained
households are most likely to adapt their borrowing preferences.
Keywords: Housing consumption, interest deduction, mortgage demand,
mortgage term
Paper Number:151 Housing Markets & Economics
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48 ERES 2015 Conference 24-27 June 2015 Istanbul
Housing Price Indexes in Central and Eastern Europe. A
Comparative Study on the Models
Costin Ciora, The Bucharest University of Economic Studies, Romania
Ion Anghel, The Bucharest University of Economic Studies, Romania
Gunther Maier, Research Institute for Spatial and Real Estate Economics, WU Wien
Austria
In recent years, housing indicators have become significant in understanding the
evolution of the real estate market. As there is a significant impact of the housing
price indexes on the public awareness of the current state of a real estate reliability
of such indices is important. This paper examines the housing price index from a
methodological point of view, with a focus on Central and Eastern Europe. Results
suggests that the majority of the real estate markets in this region is relatively new
in adopting a real estate index, compared with Western Europe or US markets.
Thus, the anchoring upon similar models developed in these markets needs to be
done with a focus on regional characteristics.
Keywords: Comparative study, house price index, housing price methodology,
real estate market
Paper Number:218 Housing Markets & Economics
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ERES 2015 Conference 24-27 June 2015 Istanbul 49
The Effect of Age-Restricted Housing on Surrounding
House Prices
Tanja Tyvimaa, Tampere University of Technology, Finland
Karen Gibler, Georgia State University, USA
Velma Zahirovic-Herbert, Georgia State University, USA
The value of property in residential neighborhoods depends, in part, on the
surrounding housing stock due to the effect of housing externalities. We
investigate the impact of age-restricted housing on the price of neighboring
condominiums in Tampere, Finland. A spatial pattern emerges in all our
specifications: age-restricted housing implies an increase in surrounding housing
values within a radius of 200 meters of up to 2.65% and up to another 2.47%
increase for an additional age-restricted property within 400 meters. The positive
spillover effect of owner-occupied age-restricted housing is larger than that of
rental housing. The positive effect of senior houses on surrounding properties is
diminished if the age-restricted property has an onsite nursing care unit. In
addition, the positive effects of age-restricted houses are not extended to assisted
living facilities.
Keywords: Finland, age-restricted housing, condominium, house prices,
housing markets
Paper Number:228 Housing Markets & Economics
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50 ERES 2015 Conference 24-27 June 2015 Istanbul
New Behavioural Business Practices: Agent Interactions in
the Housing Market
Deborah Levy, The University of Auckland Business School, New Zealand
Richard Dunning, The University of Sheffield, UK
Craig Watkins Department of Urban Studies and Planning, The University of Sheffield, UK
Agents have been crucial in shaping owner-occupier housing search and bidding
strategies (Levy et al, 2008). But, this is changing. Recent research for RICS
shows that UK house purchasers have only very limited exposure to agents. Their
decisions are now influenced by Internet listing services and a range of formal and
informal contacts (Dunning and Watkins, 2012), altering the institutional
framework of housing decisions.
The study incorporates interviews with estate agents and website providers
businesses in order to provide insights into agents’ understanding of
contemporary institutional arrangements and their role in shaping housing search
behaviour. It compares information provision, housing search and decision-
making processes in the UK and New Zealand in an ‘online’ era. These countries
have similar levels of consumer demand for owner occupancy, proclivity towards
Internet listing services and estate agency roles, but dissimilar selling
mechanisms. This juxtaposition enables a cross national reflexive approach to
analysing the relationship between agent and housing searcher.
The study highlights the opportunities and threats that exist to the estate agency
industry within the evolving institutional environment.
Keywords: Estate agents, housing decisions, institutional framework, internet
listing services
Paper Number:289 Housing Markets & Economics
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ERES 2015 Conference 24-27 June 2015 Istanbul 51
Estimation of Hedonic House Pricing Model through Non-
Parametric Methods: Istanbul Real Estate Market
Sinem Güler Kangallı Uyar, Pamukkale University, Econometrics Department, Turkey
Nihal Yayla, Pamukkale University, Econometrics Department, Turkey
Bülent Güloğlu, Istanbul Technical University, Economics Department, Turkey
The housing market is consisted of sub-markets that give it segmented structure
and it exhibits heterogeneous characteristic due to both immovable and
durableness of houses and their different structural, location and neighborhood
characteristics from each other. Accordingly, each sub-market has different
pricing structure owing to different supply and demand conditions of each
individual market. Therefore, price estimation process for houses are rather
difficult. However, Hedonic Pricing Approach especially used in pricing of
products in heterogeneous markets that enables calculation of marginal impacts
of individual characteristics on price of products and facilitates house pricing
process. During investigation of the relationship between real estate prices and
their characteristics, spatial effects are required to be taken into consideration
which are significant determinant in house prices. Spatial effects can be
presented as spatial autocorrelation and spatial heterogeneity. Whereas spatial
dependency among house prices, which arise as a result of adjacency effect are
described as spatial autocorrelation, variation in relationship between house
prices and their characteristics based on the segmented structure of the housing
market are described as spatial heterogeneity. Therefore during investigation of
the relationship between house prices and their characteristics, there is need for
models which allow relationships to vary according to locations and which
consider spatial dependency in house prices. While Non-Parametric Spatial
Models are appropriate for the standing need, the OLS Regression Model or
Parametric Spatial Models do not take spatial effects into consideration because
of their limiting assumptions. The present paper aims to have better
understanding on demand side of the Istanbul Real Estate Market by investigating
marginal effects of various characteristics of 2838 houses from 39 counties, which
are assumed to represent Istanbul Real Estate Market through Non-Parametric
Spatial Models based on Hedonic Pricing Approach in the period of October-
December 2013. The results obtained from estimation through Non-parametric
Spatial Models revealed that the relationship between house prices and their
characteristics is differentiated for each sub-market and that there is non-linear
relationship between house prices and spatial characteristics.
Keywords: Hedonic pricing approach, Istanbul real estate market, non-
parametric spatial models, spatial effects
Paper Number:92 Housing Markets & Economics
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52 ERES 2015 Conference 24-27 June 2015 Istanbul
Multiple Interests as Management Challenge for German
Housing Companies: How Diverse and Conflicting are
their Stakeholders’ Expectations?
Stephanie Heitel, TU Darmstadt Faculty of Law and Economics Department of Real
Estate, Germany
Andreas Pfnür, TU Darmstadt Department of Law and Economics, Germany
The German housing market is strongly regulated including e.g. limitations of rent
increases and energy-efficiency standards for new buildings. However, it is not
sufficient for housing companies to comply with these formulated rules. Due to a
pluralistic corporate governance system and the high social importance of
housing in Germany, the management must also consider interests by their
numerous stakeholders such as owners, employees, tenants, business partners,
politics, authorities, and other interest groups. Some foreign investors only
became aware of this required stakeholder-orientation when they were faced with
negative press and protests for not fulfilling the expectations (e.g. concerning
adequate maintenance levels).
In addition to providing affordable housing for a broad spectrum of households,
companies are expected to fulfill further interests like for example energy-efficient
buildings, adequate social management, better customer service, and increased
profit generation. Strategies to balance these different and partly conflicting
interests are required. Before interests can be balanced systematically,
transparency on the stakeholder expectations is required. The purpose of this
study is to show what kind of expectations are addressed towards housing
companies, how they differ between stakeholder groups and what kind of conflicts
may arise.
Expectations are analyzed exemplarily in a case study with a German municipal
housing company. More than 1,400 stakeholders were invited to take part in a
survey on their expectations towards the company. The survey was analyzed by
qualitative, descriptive and multivariate analyses.
The results of the survey confirm the variety of interests. Expectations not only vary
between stakeholder groups but are also heterogeneous within some of the
typical stakeholder groups.
Managers should be aware of this heterogeneity of expectations, as they often
tend to focus only on stakeholders with whom they interact regularly or who
engage proactively. Even participation approaches bear the risk of participants
representing only a small minority. Thus, companies should try to integrate
multiple stakeholder perspectives for decision-making to fulfill the diverse needs
as best as possible.
Keywords: Balancing of interests, heterogeneity of demands, housing company,
stakeholder analysis, target conflicts
Paper Number:153 Housing Markets & Economics
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ERES 2015 Conference 24-27 June 2015 Istanbul 53
House Prices in Europe – Indicator Development and
Figures
Peter Parlasca, Eurostat, Luxembourg
Bogdan Marola, Eurostat, Luxembourg
When the crisis occurred the existing sets of national house price indices (HPIs)
were often based on private sources outside official statistics. These indicators
could differ widely, in particular with respect to the type of price data, coverage
and quality adjustment. Due to sustained efforts from Eurostat and the National
Statistical Institutes (NSIs), the situation has dramatically improved since then.
Building on a pilot project launched in early 2000’s to develop price indices for
Owner Occupied Housing, Eurostat and the NSIs released the first experimental
HPIs at the end of 2010. After a period of consolidation in 2011-2012, the official
harmonised HPIs were released in the beginning of 2013. The quarterly data
started in 2005.
Official European statistics need to abide to the highest standards of quality and
harmonisation across countries. To arrive at this level, the most important issue
has been the availability of data on the price of the transactions. A second key
challenge has been associating the price to the dwelling characteristics. A third
key challenge has been the quality adjustment from one time period to the next.
The European project produced an international Handbook on Residential
Property Price Indices complemented by practical guidelines for the compilation
of harmonised HPIs. A reference legal framework has been set up targeting the
years to come without any obligation to provide back data. Today HPIs published
by Eurostat are used for several policy purposes: for monetary policy, for financial
stability and also to monitor macroeconomic imbalances in EU Member States:
The development of real house prices (nominal HPI deflated by the final
consumption deflator) is one of the eleven MIP Scoreboard indicators used in the
European Semester Monitoring.
While the policy uses rely mainly on a swift dissemination of current data, the
analysis of the housing market requires also longer data series. Eurostat has been
working on this issue and today it is possible to disseminate longer data for most
EU countries going back to 2000.
This longer series have the advantage that, in addition to the post-crisis period,
they capture the pre-crisis period. Moreover, they are available in one place for all
EU countries on the Eurostat website.The publication of HPIs for EU countries
going back to 2000 offers thus a reliable and easy-to-use source of data for those
interested in better understanding the evolution of housing markets.
Keywords: Official statistics, house price indices, housing as investment asset
Paper Number:165 Housing Markets & Economics
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54 ERES 2015 Conference 24-27 June 2015 Istanbul
Housing Market and Demography, Evidence from French
Panel Data
Yasmine Essafi, Université Paris Dauphine, France
Arnaud Simon, Université Paris Dauphine, France
Worldwide variations in the population structure are taking place over the next
century, and this is expected to have impacts on the whole economic systems,
and particularly on the housing market (i.e. price of homes, ownership structure,
and supply and demand of residential properties). In this paper, we empirically
investigate how the French real estate is affected by both economic and
demographic factors. Starting from the theoretical benchmark model of Takàts
(2012), we fist investigate the relationship between collective and individual
housing prices dynamics and GDP, total population and old age dependency
ratio. Results from fixed effect regressions on 94 French departments on the
period 2000-2013 show that real estate prices are significantly and positively
affected by the total population number and the total GDP, while they are
significantly and negatively affected by the old age dependency ratio (ratio of
population aged 60+ to the working population). This study, to our knowledge, is
conducted for the first time across departments in France. Furthermore, obtained
results and the particular case of France have motivated further research by
enriching the baseline model with various financial, real estate, economic and
demographic explanatory variables and analyzing our panel in a more segmented
way. In all cases, economic impact on real estate market is significant and around
the unit_ i.e. 1% increase in GDP leads a 1% increase in housing prices_ while
demographic factors seem to have a greater impact on housing market prices.
Keywords: Demographic factors, economic factors, fixed effect, housing market
prices, panel data
Paper Number:68 Housing Markets & Economics
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ERES 2015 Conference 24-27 June 2015 Istanbul 55
How do Optimal Reserves Compare to Actual
Undisclosed Reserve Prices? Empirical Evidence from
English Open Outcry Auctions of Residential Property
Simon Stevenson, University of Reading, UK
James Young, University of Auckland, New Zealand
The empirical analysis of auctions has frequently been constrained by data
limitations. This is especially so with respect to undisclosed reserve prices. As a
result, it has often been difficult to empirically consider some of the key theoretical
arguments regarding the impact and role of reserve prices. Using a dataset that
includes information on the undisclosed reserve prices, this paper examines
residential property auctions in Dublin, Ireland. The Irish market provides an
interesting case to consider the dynamics of the auction process and specifically
the optimal reserve price.
The analysis is based on a range of primarily theoretical pieces that have
considered the optimal value of the reserve, especially when undisclosed (e.g.
Riley & Samuelson, 1981; McAfee & Vincent, 1992; Vincent, 1995; Li, Perrigne &
Voung, 2003; Caillaud & Mezzetti, 2004; Hu et al., 2010). The primary piece of the
literature that has considered real estate in this context is McAfee, Quan & Vincent
(2002). The data set utilized in this study consists of 389 properties that were
offered for sale through auction between 1998 and 2002. Importantly, this data
includes information on variables often missing from existing empirical work,
including the undisclosed reserve, the attendance at the auction, the number of
bids and bidders and the individual auctioneer presiding. A key advantage in this
dataset is that unlike many papers (e.g. Ong et al., 2005) we do not have to rely
on proxies to capture the impact of different factors. In addition, due to the nature
of the auction procedure followed in Ireland, we are largely considering willing
sellers. Therefore, unlike papers such as DeBoer et al. (1992) and McAfee et al.
(2002), our reserve estimate is based on perceived market value and not related
to issues such as outstanding mortgage debt or unpaid tax. This allows us to
directly compare the theoretical optimal reserve with the actual undisclosed
reserve in the market place.
Keywords: Auctions, Ireland, optimal reserve price
Paper Number:135 Housing Markets & Economics
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56 ERES 2015 Conference 24-27 June 2015 Istanbul
Homebuyers’ Preference for Installed PV Systems –
Discrete Choice Experiment
Brano Glumac, Construction Management & Urban Development, Department of Built
Environment, Eindhoven University of Technology, The Netherlands
Thomas P. Wissink, Real Estate Management & Development, Department of Built
Environment, Eindhoven University of Technology, The Netherlands
Purpose - This paper contains the findings of dwelling buyers’ preferences
towards installed photovoltaic (PV) system on their potential homes and thus
provides an insight on the overall impact of PV systems to home purchasing.
Design/methodology/approach - These preferences are determined by a discrete
choice model that is based on stated preference data of dwelling buyers in the
Eindhoven region.
Findings - The most important findings are that a PV system is on average highly
appreciated by dwelling buyers and that this appreciation is relatively larger by
dwelling buyers that live in more urban/central neighborhoods.
Research limitations/implications - This paper is essentially exploratory and raises
a number of questions for further investigation such as determining the real estate
value of installed PV systems.
Practical implications - The findings would suggest that the diversity of
homebuyers’ preferences would vary. It is dependent on the homebuyers’
personal characteristics but also on institutional settings of an energy system.
Therefore, the provided insight must be regarded as local and further research is
necessary for understanding the impact on the European residential real estate
markets. Originality/value - This paper estimates the impact of the installed PV
system on the housing choice by stated choice data on the local housing market.
Keywords: Eindhoven, multi nominal logit (MNL), pv system, preferences,
willingness to pay (WTP)
Paper Number:161 Housing Markets & Economics
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ERES 2015 Conference 24-27 June 2015 Istanbul 57
Information Transparency and Pricing Strategy in the
Scottish Housing Market – an Evaluation of the Home
Report Scheme
Daniel Y. F. Lo, Department of Real Estate and Construction, Faculty of Architecture, The
University of Hong Kong, China
Nan Liu, Centre for Real Estate Research, University of Aberdeen Business School UK
The Scottish housing market has some unique characteristics. The dominating
selling mechanism is the “offers over” system, where the property on the market
is listed as “price over” a certain amount. When there is more than one potential
buyer, the seller tends to set a “closing date” at which, offers from all the potential
buyers are submitted in a form of first price sealed bid auction, normally the
highest offer will be accepted. This selling mechanism has been very popular
among sellers, and is believed to keep the market buoyant to a certain extent.
However, this unique system has also been criticised as a “corruptible system”,
mainly because it has left estate agents open to accusations of setting artificially
low asking prices to create competition, leading people who cannot afford the
property paying for surveys. Since In December 2008, the Scottish government
introduced a new regulation – the Home Report. Sellers are required to provide
information on the condition, valuation, energy efficiency and utility services when
list properties in the market, and Home Report can be accessed by potential
buyers free of charge. One of the aims of the scheme is to address the problems
created by the practice of setting artificially low asking price. Five years since the
introduction of Home Report, the Scottish government carried out consultation on
the Home Report and findings were published in 2014. While the government’s
consultation results are based on qualitative data, this paper aims to provide
some quantitative evidence on the effect of Home Report on seller’s pricing
strategy. After allowing control for market conditions, dwelling qualities and
locations, the paper tests whether there is a significant difference in price setting
in Northeast Scotland. This paper uses data from Aberdeen Solicitors’ Property
Centre from 1998 to 2013. Results from the hedonic models suggest that sellers
set price using evidence of recently transacted properties in nearby locations, and
since the introduction of the Home Report, this spatial autocorrelation is more
pronounced. The results also show that the introduction of home Report
statistically reduces the deviation between actual asking price and estimated
asking price, which is used as a proxy to the valuation. These results suggest that
sellers’ pricing strategy has fundamentally changed since the introduction of the
Home Report. The scheme appears to be effective in addressing the problems
created by the practice of setting artificially low asking price.
Keywords: The Scottish housing market, government policy, information
transparency, pricing strategy, spatial autocorrelation
Paper Number:239 Housing Markets & Economics
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58 ERES 2015 Conference 24-27 June 2015 Istanbul
Long Term House Price Series for Spain: Construction and
International Comparison
Paloma Taltavull de La Paz, Departamento de Anáisis Económico Aplicado,
University of Alicante, Spain
Francisco Juárez, University of Alicante, Spain
This paper reconstruct the long term serie of housing prices in Spain (aggregate)
using statistical methods based on ARIMA models. It build the data for sixties until
eighties period in quarterly basis, of weighted house prices for the Spanish
aggregate and some selected regions. The method uses 2 proxies for house
prices reconstruction, the GDP and Mortgage units, and base the built series on
the housing market fundamentals. After that, the paper compare the Spanish
housing prices with other long term series available like the UK, France, US,
Germany, Netherlands, Italy and Japan. The reconstruction shows the different
effect that the inflation process occurs during seventies had on housing prices
and the similarities of global cycles among European countries.
Keywords: ARIMA models, Spain, housing prices
Paper Number:33 Housing Markets & Economics
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ERES 2015 Conference 24-27 June 2015 Istanbul 59
Housing Association Objectives need to be under the
Same Roof: Report
Ing. Jan Veuger, Hanze University of Applied Sciences, The Netherlands
Purpose - Housing associations make too small a contribution to society, the
government has to step in too frequently because of maladministration, and the
associations’ executives are often unaware of the far-reaching impact of their
decisions. These are the conclusions of new academic research conducted by
Jan Veuger of Rotterdam School of Management, Erasmus University (RSM). In
his dissertation, he asserts that in numerous cases there is no correlation between
social and financial objectives. The Dutch House of Representatives debated the
results of the report Ver van huis from the Parliamentary Committee of Inquiry on
Housing Associations in early December 2014.
Design/methodology/approach - After extensive exploration of the literature and
PhD studies on the period from 2005-2009, the research design inspired based
on the grounded theory, which has a certain bias as a result of the extensive
literature study. In the line of thinking of the grounded theory, interviews with
directors more or less contracted uninhibited according to a narrative method.
Afterwards these interviews, independent of the researcher, thematic and labeled
by a single Delphi method be submitted to an expert group which created a
storyline. The results of this Delphi method have been submitted to a peer group
of directors. Then these conclusions in a survey presented to 60 selected directors
and the subsequent conclusions. There has thus been more than a triangulation
of research than just interviews, Delphi method and survey. Hypotheses are
thereby omitted because of the difficulty of fitting in within the chosen research
design inspired by grounded theory.
Findings - Why this qualitative thesis 'Control of housing associations in
consistancy with social values'? To understand and to discover patterns about the
how and why of the functioning of corporations in society as they do now. This
qualitative study is about the search for ideas, backgrounds, motives, resistors
and motives and is therefore suitable for the following question: witch
contradictions are there in the social values that underlie housing associations
that affect the way the are governed? The overall summary conclusions to answer
the central question is: Directors, at the highest level thinking about how to deal
with values ensure they drive on their own, monitor, know the consequences and
take responsibility.
Keywords: Board, consistency, housing associations, responsibility, social
values
Paper Number:97 Housing Markets & Economics
D-6
60 ERES 2015 Conference 24-27 June 2015 Istanbul
Synergy Effects of Collaboration by Housing Corporations
and Institutional Investors on the Dutch Housing Market
Erwin Van der Krabben, Radboud University Nijmegen Institute of Management
Research, The Netherlands
Joep Arts, Stec Groep, The Netherlands
The Dutch rental housing market is strongly dominated by housing corporations.
They own around one third of the total housing stock in the Netherlands and about
95% of the total rental housing stock. Consequently, the private rental market
represents only a very small segment. A substantial part of what is called ‘social
housing’ actually only belongs to that segment because of rent control: on the
private rental market these houses would be let for higher rents. For several
reasons, the national government considers this now as an ‘unhealthy’ situation.
The private sector is reluctant to invest in new, more expensive rental housing (as
distinguished from ‘social housing’), despite an increasing demand for this
segment by medium and high-income groups, due to the dominant position of
the housing corporations. At the same time, most of the housing corporations
have difficulties with investing in new social housing, because they lack the
investment capacity to do so. A potential solution to this catch 22 situation is to
create a fund with both one or more housing corporations and one or more
institutional investors as shareholders. The housing corporations’ input consists
of a part of their housing stock, while the institutional investors bring in funding.
This fund then consists of high-end former social housing, but now ‘transformed’
into private sector housing. The anticipated result would be that housing
associations will have money to invest in the renewal of their remaining housing
stock, that institutional investors would have an additional real estate segment to
invest in, and that medium and high-income groups will find more opportunities
to rent medium and high-quality housing. With help of game simulation, with the
participation of both representatives from housing corporations and institutional
investors, we have tested under what conditions these actors would be willing to
create such a fund. The game simulation shows that, in principal, both groups
believe in synergy effects, but that both cultural differences between housing
associations and investors (e.g. with respect to risk assessment; required returns
on investment; acceptable operational costs), discussions about the present
value of the housing stock brought in by the housing corporations (including
taxation issues) and present regulation still act as a barrier to such a mixed fund.
To improve the chances of creating a fund, it is crucial to agree on terms and
conditions.
Keywords: Creating a mixed rental housing fund, housing corporations,
institutional investors
Paper Number:113 Housing Markets & Economics
D-6
ERES 2015 Conference 24-27 June 2015 Istanbul 61
The Economics of Style
Frans Schilder, School of Real Estate University of Amsterdam, The Netherlands
Edwin Buitelaar, Netherlands Environmental Assessment Agency, The Netherlands
In the last decades, many advanced economies have experienced the
proliferation of design styles that refer to the past. Some have raised the
hypothesis that the willingness to pay for these neo-traditional dwellings is larger
than for dwellings with other, more ‘modern’ design styles. Theoretically this is
possible in restricted housing markets with imperfect market competition. To our
knowledge the existence of price effects for building styles has not been
researched yet. This paper reports on a cross-sectional hedonic price analysis of
building styles in the Netherlands. We find a significant price premium for neo-
traditional architecture.
Keywords: Architecture, housing market, spatial planning
Paper Number:198 Housing Markets & Economics
D-6
62 ERES 2015 Conference 24-27 June 2015 Istanbul
What to Expect from the Housing Market in 2015
Angelika Kallakmaa, Tallinn University of Technology, Estonia
The Estonian housing market has a short, but already remarkable history with
skyrocketing housing prices, a housing bust period and a slowdown in recent
years. The rise in the Estonian housing market was mostly driven by consumers’
expectations and easy access to credit. Political decisions might have been made
with the purpose of ensuring better access for households to the loan market, but
at the same time not taking into account its impact on the real estate market. The
article seeks to analyse the development of the housing market in Estonia,
evaluate the current situation and predict potential development trends. The
development of the housing market has been investigated from three main
aspects. Firstly, the development and changes of economic environments are
evaluated and links to the general development of the whole real estate market,
especially of the housing market, are provided. Secondly, the demand within and
factors influencing the housing market are analysed in greater detail. Thirdly,
changes in regulatory framework are investigated.
Keywords: Estonia, demand, housing, regulatory framework
Paper Number:257 Housing Markets & Economics
D-7
ERES 2015 Conference 24-27 June 2015 Istanbul 63
Heritage Designation and House Prices
Danielle Barentsen, Delft University of Technology, The Netherlands
Philip Koppels, Delft University of Technology, The Netherlands
Hilde Remøy, Delft University of Technology, The Netherlands
Built cultural heritage is generally believed to be an important urban amenity that
influences the attractiveness of cities as place of residence and business location.
However, while the provision and maintenance of cultural heritage is costly and
relatively easily estimated, the benefits arising from cultural heritage are much
harder to quantify. Consequently, historic buildings have been demolished
because the costs of adopting them for new use were estimated to outweigh the
possible price premium related to the historic nature of the building. Quantification
of the benefits of cultural heritage might provide an additional incentive and
justification for public and private parties to preserve and maintain the stock of
built cultural heritage. In this paper, the value effect of cultural heritage is analysed
in two ways: the price effect of listed status on the market value of dwellings is
investigated; and possible externalities – spillover effects – of listed buildings on
nearby property values are explored. For this purpose several specifications of
hedonic price equations are estimated to determine whether a listed building
status yields a price premium and if proximity to listed buildings is capitalised in
property values.
Keywords: Adaptive reuse, hedonic pricing, heritage, housing
Paper Number:31 Housing Markets & Economics
D-7
64 ERES 2015 Conference 24-27 June 2015 Istanbul
Measuring Fundamental Housing Prices in the Baltic
States: Empirical Approach
Darius Kulikauskas, Bank of Lithuania and Vilnius University, Lithuania
This paper develops a comprehensive framework for assessing housing price
misalignments from the fundamental prices in the Baltic States. For this purpose
several statistical indicators (price-to-rent ratio, price-to-income ratio, price
deviations from Hodrick-Prescott filtered trend) are used together with
econometric models. Such models include reduced form equilibrium price
regressions estimated for individual countries and for the panel as well as supply-
demand system for each of the Baltic countries. Statistical indicators are
employed in combination with the model estimates to arrive to clearer conclusions
about residential real estate price misalignments. This paper contributes to the
literature by filling the gap of monitoring housing market developments
consistently in the Baltics and developing a framework that can potentially be
used to monitor price misalignments in the residential real estate markets of other
countries.
Keywords: Baltics, fundamentals, housing, prices, real estate
Paper Number:64 Housing Markets & Economics
D-7
ERES 2015 Conference 24-27 June 2015 Istanbul 65
Is the Housing Market of the most Tourism Penetrated
Places Affected by Tourism Penetration? – The Case
Study of Crete Island
Dimitra Kavarnou, Nottingham Trent University, UK
Anupam Nanda, University of Reading, UK
This study tries to identify whether the most tourism penetrated places are the
ones which have the greatest influence in terms of house prices because of
tourism. In Chapter 1 we briefly presented the economic, political and real estate
framework of the country and particularly this of the islands. In chapter 2, we
tested standard hedonic model for the housing markets of the islands which
revealed some unique drivers. One of the basic driver, is this of tourism appearing
constantly significant across particular islands; so natural question out of that is
to look deeper into tourism penetration. By taking Crete Island as a case study,
from 2006 to 2012, we firstly structure tourism indicators for each prefecture. Then,
by using the principal component analysis, we create the Tourism Penetration
Index (TPI) of each prefecture and we rank the four prefectures of Crete from the
most tourism penetrated to the least one. The second stage of the analysis we
regress the data of the four individual prefectures in three steps: firsly, we regress
properties without the TPI effect; secondly, we use the Tourism Penetration Index
(TPI) of the first stage corresponding the prefecture and the year to each
observation, so as to observe its significance to the house prices of each
prefecture. To the last step of the second stage of the analysis, we add to the
hedonic models the TPI of the neighbour prefecture(s), so as to identify whether
there is any the spill-over effect cause by tourism penetration. The focus here is
to identify whether a) the TPIj of a prefecture j is significant on House Prices of the
prefecture, b) its significance on House Prices of each prefecture follows the same
ranking as in first stage and therefore, whether the most Tourism Penetrated
places are the ones whose houses prices have been mostly affected by tourism
penetration, c) House Prices are affected by the TPI of the neighbour prefecture
(tourism spill-over effect). Models are tested for robustness across several
specifications.
Keywords: Crete island, PCA, hedonic regression analysis, tourism penetration,
housing prices, tourism performance
Paper Number:142 Housing Markets & Economics
D-7
66 ERES 2015 Conference 24-27 June 2015 Istanbul
Structural Models of Urban Regeneration in Emerging
Markets-Turkey Case
Mehmet Emre Çamlıbel, Soyak Holding, Turkey
Gülcemal Alhanlıoğlu, Soyak Holding, Turkey
Deniz Uğurlu, Soyak Holding, Turkey
Purpose - As a national movement, urban regeneration is the future of Turkish
residential real estate market. In this paper, the models that let housing sector to
make sustainable investments to urban regeneration are examined. In this regard,
the purpose of this paper is to investigate the structural models of urban
regeneration projects take place in emerging markets from the perspective of
Turkish examples. It estimates various business and financial models according
to varying dynamics of Turkey’s recent urban regeneration projects. The paper
demonstrates decision making approaches to utilize models that will fit better
under changing circumstances.
Design/methodology/approach - The paper reviews the differences of urban
regeneration projects in developed and emerging markets. It explores the driving
forces behind urban regeneration, legal infrastructure, and practices in Turkey
specifically. It draws upon recent urban regeneration examples in Turkey. The
paper analyses the existing models and proposes methods to choose the proper
models that match with the varying dynamics.
Findings - Urban regeneration needs are different for developed and emerging
markets and even for each emerging markets. There is no one-fits-all model in
urban regeneration projects. Various dynamics play roles in adoption of proper
business and financing model in regeneration projects. Decision making process
for the model that fits the project usually lacks systematic analysis. However,
urban regeneration needs in emerging markets display similar characteristic as
they stem from the same dynamics. Hence urban regeneration practices and
models can be adapted to the projects of other emerging markets. In planning
stage of urban regeneration projects while methods, resources and financing
tools are being planned and allocated, a checklist and/or a flowchart consist of
some critical questions addressing the proper business models can be used as
decision making tools/approaches.
Research limitations/implications - This paper is essentially exploratory and raises
a number of questions for further investigation. There is scope to extend the
research to examine other business development models and propose advanced
decision making approaches addressing complicated factors.
Originality/value - This is the first paper to examine business models in urban
regeneration projects and accordingly propose decision making approaches for
adopting the suitable model to follow.
Keywords: Business model, decision making, emerging markets, financal
model, urban regeneration
Paper Number:79 Housing Markets & Economics
D-8
ERES 2015 Conference 24-27 June 2015 Istanbul 67
A Measure of Spatial Competition in Residential Brokerage
Christopher Hannum, Istanbul Technical University, Turkey
Kerem Yavuz Arslanlı, Istanbul Technical University, Turkey
This project will build a theoretical model of real estate brokerage using
assumptions based upon findings from the extensive brokerage literature. In this
model differentiation in services and quality between brokerage firms combined
with differentiation in preferences between sellers lead to measurable ranges of
operation for brokerage firms. These ranges overlap, leading to the competitive
nature of the industry. This theoretical model can be simulated in order to predict
when ranges will grow or shrink and when competition within them will increase or
decrease.
Using MLS data for Northern Colorado we will measure the range of operation in
ArcGIS for each brokerage firm and each agent in the sample by using actual
geocoded data for listings and transactions. These ranges of operation will be
used to calculate a market share of listings or transactions for the agent or
brokerage firm within their own range of operation. For example, while a county
might have 1200 listings a certain brokerage firm within that county may compete
only within a smaller area of that county in which there are 120 listings. If the
brokerage firm has 40 total listings our methodology would give them a market
share of 33% within their operating range rather than 3% within the county.
Market share measures for individual agents and brokerage firms will be
combined to generate a market concentration measure for larger predefined
areas such as cities or census blocks akin to the Herfindahl-Hirschman Index.
This will be done using a weighted average, using conventional market share
measures (the aforementioned 3%) for weights. Using panel data techniques we
will test whether higher values for our market concentration measure are
correlated with higher or lower sales prices. We will examine whether market
shares and the size of operating ranges for individual agents and brokerage firms
vary predictably with local market conditions. These tests will help to determine
what value better measures of brokerage firm market share and market
concentration will have to policy makers and real estate practitioners, potentially
in identifying desirable locations for new entrants and in predicting future trends.
Keywords: Brokerage, spatial analysis
Paper Number:120 Housing Markets & Economics
D-8
68 ERES 2015 Conference 24-27 June 2015 Istanbul
The Effect of Different Pricing Strategies in the Dutch
Housing Market
Ingrid Janssen, TIAS School for Business & Society, The Netherlands
Roger Bougie, TIAS School for Business & Society, The Netherlands
Koen Pillen, TIAS School for Business & Society, The Netherlands
The use of reserved price strategies gained popularity in the Dutch housing
market. The more common asking price strategy is still widely applied and gives
potential buyers the opportunity to negotiate below a listed asking price. Since the
market can be characterized as cold and the average time that it takes to sell the
property (Time on Market) has increased from 86 days in 2007 to 176 days in
2013, sellers and brokers are looking for new pricing strategies. In 2014 one of
every fifty houses was sold on a reserved price basis, where a fixed minimum was
the starting point for negotiation. The aim of this research was to measure the
effect of using different pricing strategies on the actual sales price and the TOM.
For this purpose data was collected on 5.316 reserved price transactions and
24.582 sales prices transactions covering the period 2009-2014. Hedonic
regression modelling was used to estimate the effect of pricing strategy on the
sales price and Time on Market. In our analyses we controlled for variables that
might potentially bias our results. Results show that using the reserve price
method the Time on Market decreases with more than 50% compared to using
the asking price method. The average reduction of the sales price, using reserved
pricing, is 4,4%. These results give clarity for sellers of houses in their tradeoff
between price concessions that they are willing to take and the expected
reduction of the time that is required to sell the house.
Keywords: Hedonic modelling, housing market, pricing, time to market
Paper Number:126 Housing Markets & Economics
D-8
ERES 2015 Conference 24-27 June 2015 Istanbul 69
London Town a Behavioural Approach to Property Prices
in the Capital City
Diego Salzman, London South Bank University, UK
Few cities in the world cause so much attention as London. Arguably the financial
centre of Europe and the beating heart of global business, London is a living proof
that some of the most important real estate economics postulates do not apply
With average prices for a one bedroom flat oscillating around half a million pounds
and an average gross income salary of merely £30k, this powerful city seems to
be more of a myth for those who aspire success rather than a pleasant city to live
in. This paper aims by using behavioural variables along with elements of
multimodal critical discourse analysis into a hedonic pricing model, to extend our
understanding of the 'irrational’ housing prices in London and why Londoners
seem to accept de-facto this inconvenient reality they are living in
Keywords: Behavioural real estate, London UK, property appraisal, real estate
markets
Paper Number:143 Housing Markets & Economics
D-8
70 ERES 2015 Conference 24-27 June 2015 Istanbul
Generation Y Homeownership in Malaysia
Mohd Azhar Ab Wahid, University Malaya, Malaysia
Owning a home is a fundamental importance for most of Malaysians.
Homeownership has always been one of the concerns amongst the young
generation entering adulthood. The increasing trend of home prices may be
beyond reach for many Malaysians, especially the young people who are just
entering the work force with their existing commitments and expenses. The aim of
this study is to identify the earliest possible age of homeownership amongst
Generation Y in Malaysia. In order to achieve the research aim, findings for this
research to be established are as follows; to examine the housing preference of
Generation Y homeownership; to identify the location of property of Generation Y
homeownership; and to determine the housing price affordable to Generation Y.
The secondary data of residential property transactions in Selangor, Malaysia are
used in order to achieve the aim and objectives. The findings of this research are
the housing preference for the Generation Y in Selangor and the most preferred
location of Generation Y homeownership. The research indicates that the housing
price affordable to the Generation Y in Selangor is RM250,000 and for landed
property is RM400,000.
Keywords: Generation Y, homeownership, housing
Paper Number:67 International Real Estate
E-1
ERES 2015 Conference 24-27 June 2015 Istanbul 71
International Competitiveness of China’s Construction
Firms
Puying Li, Real Estate and Land Management School of Royal Agricultural University, UK
Simon Huston, Royal Agricultural University, UK
The purpose of this Ph.D. research is to systematically investigate the factors
which influence the international competitiveness of Chinese Construction Firms
(CCFs). The research is conducted in conceptual, empirical, corroboratory and
reflexive phases using a combination of secondary and primary sources.
Secondary data and questionnaire responses are analysed statistically but case
study observations and corroboratory interviews are handled qualitatively.
To address the research aim, specific research objectives are set: 1.Identify the
Chinese construction firms’ problem and outline a pathway for a complete answer
to it. 2. Undertake a systematic literature review of notions of competitiveness in
various fields to develop a conceptual framework of CCFs. 3.Conduct a
preliminary desktop review of global construction firm best practices, comparing
successful with unsuccessful firms. 4. Describe the methodology for a complete
answer to the Chinese construction firm question. 5. Analyse CCFs’ Key
Performance of Indicators (KPIs). 6. Apply the exploratory knowledge to fine-tune
the preliminary model of international competitiveness of CCFs. 7. Operationally
test the refined CCFs’ international competitiveness model against a combination
of quantitative and qualitative research evidence. 8. Conduct focus group meeting
to consider institutional, cultural, geographical, political and religious issues which
could moderate CCFs’ international competitiveness. 9. Distil research findings
and make key policy recommendations.
The combination of desktop secondary research, analysis of KPIs, case studies,
surveys and interviews will provide a complete answer to the research question of
what factors influence the international competitiveness of Chinese construction
firms.
Keywords: KPIs, construction firm, construction market, international
competitiveness, performance
Paper Number:96 International Real Estate
E-1
72 ERES 2015 Conference 24-27 June 2015 Istanbul
An Assessment of the Viability of Large Mixed-Use Real
Estate Developments in Sub–Saharan Africa
Francois Viruly, University of Cape Town, South Africa
This study provides an understanding of the viability and investment decision
making processes associated with mega, mixed-use developments across Sub-
Saharan Africa (SSA). In doing so the study questions the economic and non-
economic parameters that drive these projects and the market reality of the
feasibility studies that they are based on. Due to their size, the success or failure
of these projects can have considerable private and public implications.
In addressing these questions, the research considers the academic literature that
has developed around the characteristics of large mixed use developments.
Research conclusions draw on the existing literature and four case studies located
in Kenya (Tatu City), Nigeria (Eko Atlantic), South Africa (Century City) and the
DRC (Cite Du Fleuve). These projects are approximately of a similar size and
value, incorporate a number of residential and non-residential uses, and have the
potential to significantly impact on local markets.
The study draws the conclusion that decisions to undertake mega real estate
projects across SSA tend to be based on parameters that extend beyond private
financial objectives and often fail to take cognizance of the market context.
Keywords: Mixed use developments, feasibility parameters, spatial impact of
mixed use developments, sub-Saharan Africa
Paper Number:190 International Real Estate
E-1
ERES 2015 Conference 24-27 June 2015 Istanbul 73
Housing Affordability Changes in Baltic Capitals: On the
Effect of Housing Boom and Negative Housing Equity on
Housing Affordability
Kristian Kahre, Tallinn University of Technology, Estonia
Ene Kolbre, Tallinn University of Technology, Estonia
After the early 2000s housing boom Baltic countries´ capitals witnessed strong
downturns in residential housing market in 2007/2008, with apartment prices
contracting between 2007 and 2009: 45.5% in Tallinn, 59.6% in Riga, and 39.9%
in Vilnius. We analyze the changes in income, repayment and purchase
affordability. The income affordability in terms of price-to-income ratio decreased
based on three city average more than 55% just in short timeframe of 2004-2007;
it improved significantly after the contraction in prices in 2009. The housing
affordability index (HAI) shows that by the end of 2013 the repayment and
purchase affordability was in comparison to the peak of the boom in 2007
approximately two times higher in Tallinn, three times higher in Vilnius, and four
times higher in Riga. We also show the extent of the problem of negative housing
equity and how it can affect housing market.
Keywords: Baltic States, housing affordability, housing boom, price-to-income
ratio
Paper Number:303 International Real Estate
E-2
74 ERES 2015 Conference 24-27 June 2015 Istanbul
Global Brands the New Global Badge of Real Estate
Service Quality?
Eamonn D'Arcy, University of Reading, UK
Stephen Roulac, Roulac Global, USA
This paper examines the strategic implications for the future of real estate services
(RES) of the creation of global real estate service brands as a result of a long-
standing process of internationalisation in this sector. This process has had two
distinct phases; an initial period of consolidation from 1997 which resulted in the
evolution of embryonic global service delivery platforms and a second phase of
consolidation post the global financial crises where the creation of truly global
brands was a key driving force. The analysis examines how a strong brand image
has created new intangible assets for the sectors principal global delivery
platforms and thus has altered the competitive landscape in the sector on a
number of levels. It also considers brand image as a proxy for service quality and
reputation and how branding in the sector has displaced the role of professional
bodies and affiliations as badges of service quality. It concludes with an
assessment of the prospects for further consolidation in the sector creating fewer
but potentially stronger global brands.
Keywords: Global brands, internationalisation, real estate services
Paper Number:305 International Real Estate
E-2
ERES 2015 Conference 24-27 June 2015 Istanbul 75
Real Estate and Global Capital Networks: Drilling into the
City of London
Colin Lizieri, Cambridge Real Estate Research Centre, University of Cambridge, UK
Daniel Mekic, Cambridge Real Estate Research Centre, University of Cambridge, UK
There is a growing awareness in urban social science of the importance of
commercial real estate as a medium by which large cities are embedded within
global capital networks. City centre transformations emphasising office
development focussed on financial and business services firms tie cities into
international employment cycles while the capital sunk into the real estate locks
those cities into global capital markets through ownership and finance. This trend
is most pronounced in developed world cities whose focus is on financial services.
The process has become more marked with the globalisation of commercial real
estate markets. RCA data for major office deals 2007-2014 show 35% of those
transactions were cross-border. Investment is strongly concentrated: 20 cities
account for over 67% of deals by value. Major global investors and international
chains of brokers and agents play a key role in this process.
While urban research has become more aware of these tendencies, the nuances
of market processes are often lost in over-simplistic categorisations such as
“international financial capital” or “property developers”. There is considerable
diversity in the nature of office investors with substantial differences in motivations
for building international portfolios and in the impacts of investment for the cities
concerned. Further, there is a substantial separation between the process of
development and the process of longer term investment that often seems
downplayed in academic research.
This paper aims to address that gap with a detailed examination of the City of
London office market. The study draws on a unique database identifying
ownership of offices for over 40 years, allowing analysis of the shift over time from
predominantly local domestic ownership to 2014 when over 60% of space is non-
UK owned. We analyse changing tides of ownership linked to transformation of
the City economy, the data revealing waves of ownership which differ nationally,
regionally and by entity type. We trace the new developments in the City revealing
the processes that link development and investment activity. These analyses will
be placed in the context of employment trends and the investment performance
of the City office market in national and global context and draw on evidence of
the motivations and objectives of global real estate investors. The paper
concludes by examining the implications for the planning, governance and
economy of cities.
Keywords: Global capital flows, office markets, real estate ownership
Paper Number:177 International Real Estate
E-2
76 ERES 2015 Conference 24-27 June 2015 Istanbul
The Effect of Interest Rates Changes on Listed Real Estate
Companies
Rene-Ojas Woltering, University of Regensburg, Germany
This paper examines the effect of interest rate changes on the performance of
listed real estate companies. The motivation for the analysis is based on the idea
that interest rate changes are negatively related to a) the relative attractiveness of
equities compared to other asset classes such as fixed income or the money
market, b) the prices of the underlying properties of the listed real estate
companies, and c) the operating performance of listed real estate companies as
the costs of debt rise. The analysis is based on monthly data over the 2000 to
2014 period for a global panel of 9 regions. This rich setting offers substantial
heterogeneity in interest rates across time and countries. In additional analysis I
investigate the effect of interest rates on relative price measures such as the
discount or premium to NAV. Furthermore, I account for foreign currency effects
by considering both, the perspective of an unhedged US-investor and the
perspective of an investor that only makes hedged investments.
Keywords: Interest rates, international real estate, REITS, real estate stocks
Paper Number:7 International Real Estate
E-3
ERES 2015 Conference 24-27 June 2015 Istanbul 77
The Direct Costs of A-REIT IPOs
William Dimovski, Deakin University, Australia
Direct costs of Australian REIT IPOs were last reported in the literature using data
to 2004. Much has occurred since then. This study introduces and includes the
A-REIT IPOs over the last 10 years and examines the cost and the factors
influencing the percentage underwriting and percentage total direct costs by A-
REITs IPOs. The study also investigates specifically whether the utilization of an
underwriter (who guarantees the success of the capital raising) rather than a
stockbroker (who doesn’t guarantee such success) costs significantly more. The
study finds that larger capital raisings and those with large investor or institutional
involvement identified in the prospectus are significant in reducing underwriting
costs. The study does not find that underwritten IPOs are significantly more
expensive (or cheaper) than those not underwritten. Additionally, the size of the
issue, whether the firm offers stapled securities (is internally managed) and has
higher net asset to issue price characteristics reduces the total cost of
underwritten IPOs.
Keywords: Australia, IPOs, REITS, total direct costs, underwriting costs
Paper Number:202 International Real Estate
E-3
78 ERES 2015 Conference 24-27 June 2015 Istanbul
Are REITs more Transparent than Stock: Evidence Using a
Propensity Score Model
Vivek Sah, University of San Diego, USA
Alan Tidwell, Columbus State University, USA
Research on the broader US equity market shows that corporate credit rating
downgrades and negative Credit Watch announcements affect stock prices
negatively. Holthausen and Leftwich (1986) examine the common stock price
reaction to bond rating changes and Credit Watch announcements and find
evidence of a stock price response to all events except an actual rating upgrade.
Dichev and Piotroski (2001) examine the long-run stock returns following bond
ratings changes, using Moody’s bond rating changes from the 1970 to 1997 time
period. They find limited abnormal performance for upgrades, but statistically
significant negative abnormal returns of 10 to 14% in the year subsequent to a
downgrade. Thus, they conclude the market does not fully anticipate the negative
implications of downgrades for future profitability. REITs on the other hand may
or may not react similarly to credit rating announcements due to their special
regulatory environment. The literature points to credit ratings as a factor that
broadly impacts external financing decisions and capital structure. REITs target
debt levels to obtain credit ratings just above the investment grade cutoff point
where clear differences in financing cost and length to maturity can be observed
(Brown and Riddiough (2003) and Highfield, Roskelley and Zhao (2007)), and
REITs with banking relationships are more likely to have credit ratings (Hardin and
Wu (2010)). Additionally, Campbell, Dodd, Hill and Kelly (2012 working paper)
offer evidence that credit ratings are inversely related to dividend volatility and
measures of financial constraints. This study compares and contrasts the effect
of rating changes on REITs and non-REIT stocks. This is done by using the non-
REIT group as a control group. The control group is created by a unique
propensity score model based on multiple REIT characteristics. By creating a
control group comprising of non-REIT stocks that are similar to the treatment
group REITs, it gives us a chance to compare two set of entities that are similar
on a set of characteristics. The data for this study is from 2003 to 2013. We use
ratings from Moody’s, S&P and Dun and Bradstreet. The hypothesis that REITs
are more transparent than non-REITs is tested by measuring market reaction to
credit change announcements for both the groups that have been created.
Keywords: Credit ratings, REITs, transparency
Paper Number:241 International Real Estate
E-3
ERES 2015 Conference 24-27 June 2015 Istanbul 79
Strategic Relevance of Due Diligence Real Estate – An
Integrated Transaction Cost Theory Approach
Ayosha Orth, REAG, Germany
The subprime mortgage crisis caused significant damage to the international real
estate market. Did the crisis teach us anything? In practice, yes. For one,
examinations in the form of due diligence of real estate assets have become more
frequent and more thorough. Activities on the real estate market in Germany are
recovering robustly and have almost reached pre-crisis levels. Thus, the practice
of due diligence is increasing correspondingly.
However, the literature on due diligence real estate is still exiguous and lacks
outright theoretic approaches. This thesis investigates the relevance of due
diligence within real estate transactions by contextualizing it within integrated
Transaction Cost Theory approaches and its behavioral assumptions.
Transaction-cost and agency-theory parameters such as bounded rationality,
opportunism and uncertainty offer approaches for describing how due diligence
reduces information asymmetries, uncover hidden characteristics, and therefore
prevent adverse selection. The conducted multi-method qualitative study affirms
the strategic relevance of due diligence within real estate transactions. It indicates
that due diligence is fundamental and serves to minimize risks by reducing
information asymmetries.
The main finding is that shorter portfolio life-cycles and the growing trend towards
outsourcing indicate clearly that the asset real estate is becoming a commodity.
The relevance of due diligence real estate is therefore also gaining. In times of
high volatility and uncertainty, a reduction of information asymmetry is highly
desirable.
Keywords: Asymmetric information, due diligence real estate, hidden
characteristics, transaction cost theory, uncertaintyinvestment
decision making, real estate risk and return factors
Paper Number:40 International Real Estate
E-4
80 ERES 2015 Conference 24-27 June 2015 Istanbul
Examining the Time of Housing Supply
Guowei Gu, London Institute of Real Estate, School of the Built Environment, London
South Bank University, UK
Housing is one of the essential contributing factors to the growth of the economy.
“Despite its importance, however, the housing sector has not received adequate
attention from macroeconomists.” (Zhu, 2014) Housing studies in general cover
two areas – housing demand and housing supply. Compare with housing
demand, researchers have noted that housing supply is understudied (Green, et
al, 2005) probably due to the deficiency of micro-data of housing supply which
embraces supply quantity and supply time. By gathering 885 housing projects
from the official property registration platform in Shanghai, China, this paper
focuses on examining how the time of housing supply is determined, more
specifically the determinants of the first period of time* from land supply to
housing supply. After analysing the generalized property development model and
undertaking multiple linear regressions, we find that government is a major party
in influencing the times of housing supply. Firstly, the permits and certificates
required by various government or government related agents in the process
largely determine the length of construction and marketing. Secondly, the three
independent variables, i.e. plot area, plot ratio and housing price, are all significant
at 1% level. Relatively speaking, plot ratio exerts bigger impacts than the other two
on the dependent variable of the first period of time with a coefficient of 4.63. The
results prove that government could play a vital role in housing supply.
Keywords: Housing supply time, land supply, plot ratio, property development
process
Paper Number:54 International Real Estate
E-4
ERES 2015 Conference 24-27 June 2015 Istanbul 81
Global Comparative Effects of Civil Unrests on Hotel
Performance
Sofia Dermisi, Urban Design and Planning College of Built Environments University of
Washington, USA
Civil unrest is an old phenomenon with causes spanning from economic
conditions to political, ideological, religious and other perceived oppressions or
limitations by a portion of an area’s population. The level of unrest can span the
full spectrum of crowd dynamics, from peaceful demonstrations to riots, with their
fall-out effects causing minimal to significant damage in both the urban
environment as well as the urban fabric. The extent, intensity and time-frame of
the civil unrests affect an area’s commerce, with hotels being in the forefront of
such risk due to the perceived fear resulting in reservation cancellations and
therefore lost income for owners of this real estate asset type. The paper focuses
on hotel performance in select countries across continents which experienced civil
unrest due to the financial crisis, occupy and political movements (e.g. Arab
Spring) as well as radical or racial tensions. Utilizing hotel data from 2000 through
the beginning of 2015 the paper explores the links between performance
indicators, such as Average-Daily-Rate (ADR) and Revenue-Per-Available-Room
(RevPAR) with civil unrest variables while differentiating among luxury, mid-price
and economy hotels. Two distinct methodologies are applied: a) identification of
densities and clustering of civil unrest events and hotel performance trends with
the use of GIS and b) econometric analysis with the use of fixed effect regression
modeling. The initial results suggest that economic and radical unrests affect
more deeply hotel performance compared to others.
Keywords: Average daily rate and revenue-per-available-room, civil unrest,
clustering and density, GIS, hotel performance
Paper Number:83 International Real Estate
E-4
82 ERES 2015 Conference 24-27 June 2015 Istanbul
Reconsidering the ‘Internet Effect’: Real Estate Retail
Outcomes in Australia & the UK 83
Nicola Livingstone, Bartlett School of Planning, UCL, UK
Sara Wilkinson, University of Technology, Australia
Online retailing has evolved in recent decades and now represents a significant
and integral element of the retail market. The ‘internet effect’ has been manifested
in diverse ways across different markets, with international responses to the
growth of online shopping and the real estate consequences for the UK and US
markets examined by Worzala et al (2002). With the benefit of hindsight, this paper
seeks to revisit the conclusions drawn by Worzala and other researchers (Dixon
& Marston, 2002; Ellis-Chadwick et al, 2002) at the beginning of the Twenty-First
Century, assessing their relevance and application to the online retail markets
which have emerged in the last decade in Australia & the UK. The research
addresses the lacuna of research regarding the real estate outcomes for the retail
market as a consequence of developments in online shopping (2004-2014).
The retail industry in Australia (2010-11) accounted for 4.5% of GDP, employing
10.9% of the working population (ABS, 2012). Retailing is similarly highly
significant in the UK and employs approximately 3 million people, more than 10%
of the workforce (BRC, 2012). In 2012 the retail sector contributed £151bn (16%)
to the UK’s economic output (ONS, 2014). Although retailing plays a key role in
the developed economies of Australia and the UK, when it comes to the evolution
of online retailing they are structurally very different industries. In terms of internet
retailing, the UK has the greatest proportion of sales globally, with 11.5% of retail
sales in November 2014 made online (ONS, 2014). By November 2014 in
Australia, online sales for the preceding year were equivalent to 6.8% of the total
spent in traditional retailers (NAB, 2014). Cushman & Wakefield rank the UK as
the most developed online market globally, followed by the USA, Germany and
France. Australia is ranked 14th (Cushman & Wakefield, 2013). This paper
considers the evolution of internet retailing in the UK & Australia markets,
considering the characteristics of the retail markets themselves, the central
differences in the evolution of online shopping within them, strategic shifts in
retailing patterns towards multi-channel interfaces, and the resulting
consequences for the retail real estate market so far. It is a qualitative assessment
of the ‘internet effect’ in prime Australian and UK markets, combining secondary
data with interview responses from leading retailers.
Keywords: Australia, UK, international experience, online retailing, qualitative
analysis
Paper Number:348 International Real Estate
E-4
ERES 2015 Conference 24-27 June 2015 Istanbul 83
Thinking - In and Outside - The Box: Asynchronous and
Substitutable, Hyper-complexity and Predictability, Risk
and Value, Sustainability and Permanence, Disruption and
Destruction
Stephen Roulac, Roulac Global, USA
Most property practioners are innocent of the prospects for and consequences of
innovation, presuming that real estate involvements somehow are exempts from
the forces of Creative Destruction and Disruptive Innovation. Notably, two of the
most successful IPOs in recent times, AirBnb and Uber have profound real estate
implications. The former now accounts for an inventory of lodging facilities larger
than any hotel brand. The latter's assault on car ownership could realign spatial
patterns, property values, and regional economic status.
How innovation threatens established interests and creates new opportunities,
and thereby impacts the property markets, is the subject of this paper. The
elements of the property process in the context of the supply chain and value
chain are examined through the prism of change patterns over time, present
vulnerabilities, future consequences and implications.
The many facets of the property box—its creation, function, placement,
productivity, financing, experience, operations, management, profitability, value—
are considered in the context of the six primary technologies: transportation,
information, communications, knowledge/meaning, energy/power, money, that
determine the demand for property goods and services and shape our places.
This research builds on numerous prior studies by the author of these
phenomena, extending over four decades, and integrates the implications of such
powerful themes as the Internet of Things, Predictive Analytics, Big Data,
Personalization and Customization, SaaS Business Models, Place Competition,
Gamification, Amplification, and more.
Keywords: Innovation, development, technology, real estate economics
Paper Number:271 Market Research Analysis&Forecasting
G-1
84 ERES 2015 Conference 24-27 June 2015 Istanbul
Transactions Based Commercial Real Estate Indices: A
Comparative Performance Analysis
Ke Qiulin, The Bartlett School of Planning, University College London, UK
Karen Sieracki, KASPAR Associates Ltd, UK
Michael White, Nottingham Trent University, UK
Property performance indices have become well established in the UK and other
countries. This is important from an investment perspective as it enables
comparisons to be made against other asset classes. In this paper we compare
the performance of existing valuation based and transactions based indices with
a new transactions based index. Specifically we evaluate whether the new
transactions index can fulfil the role of a performance benchmark for commercial
real estate investments. The paper analyses index construction methods
identifying the most appropriate method for construction of the new transactions
based index for UK commercial property. The new index is then constructed for a
period of over 40 years from 1970 to 2013. We consider how well the new index
reflects the underlying market and market movements and compare its
performance with both valuation and transactions indices.
Keywords: Index, UK commercial property, transaction
Paper Number:281 Market Research Analysis&Forecasting
G-1
ERES 2015 Conference 24-27 June 2015 Istanbul 85
The Role of Liquidity in Forecasting Office Yields in Europe
Sotiris Tsolacos, Henley Business School, UK
Kyung-Min Kim, Seoul National University Graduate School of Environmental Studies
Dept of Urban & Regional Planning, Korea
The impact of the global financial turmoil and the sovereign debt crisis on the
volume of investment transactions has been well publicized. A prominent trend
has been the volatility and shifting pattern in investment flows in European
investment markets post 2008. This volatility in investment activity levels, which is
hardly surprising given the Eurozone woes, has been reflected in pricing which
also exhibited significant variation. Capital flows or investment turnover reflect
investor sentiment and impact on risk premia. A key research question is to
assess the incremental impact of fluctuating turnover volumes on office yields.
Existing global research to study yields builds on theoretical frameworks that
incorporate economic factors, financial series and fundamentals in the real estate
market. Further, this body of research explains yield movements utilising a host of
other factors. These include market transparency, currency risks if not hedged,
financial risks, lease structures and property rights – with the list of such factors
being more extensive. However, the high volatility in real estate prices and yields
in the last five years directs our research attention to investor confidence and
sentiment as causes of rapid yield/price adjustments. This guides the setup of our
empirical investigation which takes part into two stages.
In the first stage a model is built aiming to capture yield movements. This model
needs however to be strongly responsive to allow for quick adjustments in yields,
which was the case in the period 2007 to 2010. In the second stage the model is
augmented to accommodate cross border capital flows. These models are
estimated with data from major European office centres.
The contribution of the study is threefold. First, the study sheds further light into
the determination of European office yields. Second, it identifies the factors which
have more immediate effects on yields and are more appropriate to explain their
short-term fluctuations. The third implication of the study is deemed the most
important one. It quantifies risks for the current office yields in Europe that can
arise from the economy and reversals in investment turnover.
Keywords: Office yields, capital flows, risk factors
Paper Number:286 Market Research Analysis&Forecasting
G-1
86 ERES 2015 Conference 24-27 June 2015 Istanbul
Bond Rate Trends and their Impact on the Relationship
with Real Estate Yields
Tony McGough, BCA Research, UK
Jim Berry, University of Ulster, UK
In the last year many financial markets have continued to show a downward trend
in government bond rates. In some markets like Switzerland 10 year rates have
been posting negative yields. The relationship between bond yields and
commercial real estate pricing is a well-known one. The impact of changes in the
so called ‘risk free rate’ on property yields, given their large income component,
is understandable. So what is the implication for real estate yields if bond rates
move negative on a wider scale? More importantly what is the implication of
continued downward pressures generally within financial markets on the value of
real estate? This paper examines the signals being sent from the bond markets
concerning long term pricing of prime and secondary assets and considers what
relationship remains with real estate as bonds move to ultra-low levels. Having
broken down the signals it examines the statistical relationship, and considers
whether there is evidence of statistical breaks as extreme points occur within the
financial markets.
Keywords: Bond Yield analysis, commercial markets, real estate indicators,
statistical breaks
Paper Number:297 Market Research Analysis&Forecasting
G-1
ERES 2015 Conference 24-27 June 2015 Istanbul 87
Rationality and Momentum in Real Estate Investment
Forecasts
Fotis Mouzakis, Frynon Research, Greece
Dimitrios Papastamos, Eurobank Property Services S.A., Greece
Simon Stevenson, University of Reading, UK
This study examines the rationality and momentum in rental and capital value
forecasts of commercial real estate investment market in the United Kingdom. The
adopted approach employs three dimensional panel data methods, by attributing
the time series dimension to the sequential re-issues by a forecaster of a certain
target forecast. The empirical method allows a multiplicity of assumptions
regarding the covered by the data target time periods, forecast horizons,
forecasters or groups of those to be examined with simultaneous use of the overall
panel of data, without the need of segmenting the data set. The investigation
includes macro-economic attribution factors to the temporary levels of forecast
accuracy, such as Gross Domestic Product and the Default Spread. The empirical
findings demonstrate that forecasters tend to maintain their biases over
subsequent issues of the same target forecast, regardless of the lowering
forecasting horizon. The results also indicate that forecasting accuracy is
positively correlated with macro-economic conditions at the time of prediction.
Keywords: Bias, forecast errors, momentum, property forecasts
Paper Number:285 Market Research Analysis&Forecasting
G-2
88 ERES 2015 Conference 24-27 June 2015 Istanbul
Cyclical and Structural Components to Yield Movements:
The Case of Central London Offices
Keith Lown, Nottingham Trent University, UK
Michael White, Nottingham Trent University, UK
The central London office markets have entered a period where, in every sub-
sector, historically low prime yields have been registered. In more normally
recorded market circumstances the phenomenon of mean reversion tendency
would be expected to have a moderating impact on yield compression at this
stage in the property cycle. However, in London other powerful influences could
be neutering the expected reversion to mean principle. Essentially these are: The
sheer weight of capital arriving in London from predominantly middle eastern and
far eastern sources; the emergence of London as one of, if not the, pre-eminent
global safe haven for international real estate investors, and a desire for wealth
protection over investment return from large sections of the global investment
community.
In these circumstances, could London be argued to have developed a large
degree of immunity to a number of the traditionally accepted key influences on
yield profile? (for example UK GDP growth or relatively modest movements in
rental levels). In addition, have some influences risen in their importance and
others waned? This research seeks to identify the key impacts on yield profile that
have traditionally been recognised; determining if there are any new key impacts;
and quantifying the likely degree of influence on net initial yield composition that
these component forces have.
Keywords: Cycles, mean reversion, offices, yields
Paper Number:310 Market Research Analysis&Forecasting
G-2
ERES 2015 Conference 24-27 June 2015 Istanbul 89
Hedonical Office Rents Index with Spatial Econometrics
Ramiro J. Rodriguez, BNP Paribas Real Estate&Universidad Complutense de Madrid,
Spain
We explore the evolution of the office market rents in Madrid by means of a spatial
hedonical modelling. We estimate rental levels in a semi-annual basis by fitting a
model with a set of hedonical exogenous variables as well as with the impacts of
“neighbour” transactions. Our dataset comprises a new-letting contract list since
2003 to 2014 with a semi-annual structure including both a wide range of
characteristics intrinsic to each leased property and the geocoding (UTM
coordinates) of each transaction. This allows us to both uncover impacts on real
rents of several hedonical property characteristics and outline a controlled
dynamic path for real rents. The focal elements determining rents in the Madrid
office market are localization with respect to the Central Business District (the
farther from the CBD the lesser the rent), the age of the construction, the technical
quality of the building and the international openness of the tenant, which is a
proxy for its commitment with the landlord via a strong lease contract. We also
prove the existence of relationships of influence of neighbour office rents on new-
contract rent levels. In terms of the dynamics of the rents themselves, when
estimating the rent of an archetypical office, our methodology effectively captures
the downward span between 2003 and 2004 as a result of the “dot-com” bubble
bust, the pick-up period of the recent Spanish economy boom (2005-2008) and
the bust period of 2008-2014. Compared to the simple average and the deal-size
weighted average, our methodology uncovers a lower average rent in the bust
period. This may be explained by the limitation of average methodology to capture
spatial feedback in prices as well as sample composition skewness that our
methodology actually does not have.
Keywords: Commercial property, hedonic modelling, office market, rent Index,
spatial econometrics
Paper Number:242 Market Research Analysis&Forecasting
G-2
90 ERES 2015 Conference 24-27 June 2015 Istanbul
The Office Market in Vienna: An Analysis of Trends and
Cycles
Peter Sittler, Endowed Chair of Real Estate Institute for Real Estate Management FHWien
University of Applied Sciences of WKW, Austria
Alexander Bosak, Bosak Real Estate Consulting GmbH, Austria
In the economic situation the existence of real estate cycles is evident. Especially
the office market is influenced by several micro- and macroeconomic factors. In
contrast to the housing market rents the office market rents do not rise significantly
in Vienna. They remain constant or even declined over the years.
In the first part of the paper a brief overview to the theory of real estate cycles and
the theoretical approach of analysing real estate cycles is given.
In the second part of this paper a structural time-series methodology is used to
predict the prime rent and real estate cycles in the Viennese office market. As a
result two types of predicting long-time movement models are given. A correlation
of delayed vacancy rates time series shows a cycle length of the Vienna office
market of nine years. The model is based on data from CBRE Austria
supplemented by own research. The investigation on real estate cycles in the
Viennese office market has shown that a simplified model based on the vacancy
rate and the growth rate of real gross domestic product (GDP) will also create
valid results. From these calculations it can be determined that the change in the
vacancy rate progresses the change in real prime rent by three years.
In the third part recommendations for the management of real estate companies
are given, which are based on the theoretical backgrounds and the empirical
analysis. How investors or asset managers operate in office markets is highly
depending on the occurring office market cycles for example in order to determine
the optimal time of lease renewal.
Keywords: Market analysis, office market, real estate cycles, time series
analysis, Vienna
Paper Number:3 Market Research Analysis&Forecasting
G-3
ERES 2015 Conference 24-27 June 2015 Istanbul 91
Sentiment-Based Predictions of Housing Market Turning
Points with Google Trends
Marian Alexander Dietzel, University of Regensburg IREBS, Germany
Purpose – Recent research has found significant relationships between internet
search volume and real estate markets. This article examines whether Google
search volume data can serve as a leading sentiment indicator and is able to
predict turning points in the US housing market. One of the main objectives is to
find a model which can be used to produce real-time forecasts in practice.
Methodology – Starting from eight individual real-estate-related Google search
volume indices, a multivariate probit model is derived by following a selection
algorithm. The best model is then tested for its in- and out-of-sample forecasting
ability. Findings – The results show that the model predicts the direction of monthly
price changes correctly with over 89 per cent in-sample and just above 88 per
cent in 1 to 4-month out-of-sample forecasts. The out-of-sample tests show that
although the Google model is not always accurate in terms of timing, the signals
are always correct when it comes to foreseeing an upcoming turning point. Thus,
as signals are generated up to six months early, it functions as a satisfactory and
timely indicator of future house price changes. Practical Implications – The results
suggest that Google data can serve as an early market indicator and that the
application of this data set in binary forecasting models can produce useful
predictions of upward and downward movements of US house prices, as
measured by the Case-Shiller 20-City House Price Index. This implies that real
estate forecasters, economists and policy makers should consider incorporating
this free and very current data set into their market forecasts or when performing
plausibility checks for future investment decisions. Moreover, the results could
potentially be of value for traders investing in Case-Shiller House Price futures and
options. Originality – This is the first paper to apply Google search query data as
a sentiment indicator in binary forecasting models to predict turning points in the
housing market.
Keywords: Forecasting, google data, housing market, sentiment, turning points
Paper Number:37 Market Research Analysis&Forecasting
G-3
92 ERES 2015 Conference 24-27 June 2015 Istanbul
How to Identify Housing Bubbles? A Decision Support
Model
Charalambos Pitros, University of Salford, UK
Yusuf Arayıcı, University of Salford, UK
Purpose – The purpose of this paper is to provide a decision support model for
the early diagnosis of housing bubbles in the UK during the maturity process of
the phenomenon. Design/methodology/approach – The study adopts a positivist
approach utilising several parametric statistical tools to support the usefulness of
normal distribution theorem to bubble detection. The strategy of this study
involves case study analysis by relying on the UK housing bubble periods of 1986-
1989 and 2001/2-2007. The research process for the model development is
divided into four stages. The first stage includes the identification and verification
of the selected variables. The second focuses on the key constructs of the model.
The third stage identifies the model’s diagnostic rule and proposes the model.
The fourth stage includes the tests of the model through the implementation of
the case studies.
Findings – The findings of the model reveal that the period of 1986-1989 and the
period of 2001-2006 were bubble periods for the UK housing market at a 95%
confidence interval. At 90% confidence the model reveal that the UK housing
market was in a bubble for the periods between 1986-1989 and 2001-2007. The
study further founds that for uncovering housing bubbles in the UK house price
changes have the same weight with the debt-burden ratio when their velocity is
positive. The application of this model has led us to conclude that the model’s
outputs are fluctuated in line with the phases of the UK real estate cycle.
Originality/value – This paper is amongst the few studies that propose a model for
identifying housing bubbles in the UK and the first to be based purely on the
acceleration rate of the model input. This is also the first study that attempts to
hierarchize each variable on the basis of which variables accounts better the
presence of housing bubbles. This paper will help researchers and professionals
(i.e. appraisers) to better understand the ‘risk’ associated with the presence of
bubbles in the UK housing market.
Keywords: Housing affordability, housing bubbles, normal distribution, UK case
study
Paper Number:115 Market Research Analysis&Forecasting
G-3
ERES 2015 Conference 24-27 June 2015 Istanbul 93
User Costs of Housing, House Price Developments and
Real Estate Bubbles: Evidence from Germany
Michael Schier, Cologne Institute for Economic Research, Germany
Michael Voigtländer, Cologne Institute for Economic Research, Germany
Real estate prices increased markedly in Germany, in particular in metropolitan
areas. These increases lead to the conjecture/presumption that speculative
bubbles are developing, similar to those in Spain or Ireland in 2007 and 2008.
Based on a user cost of housing approach it is shown, that for most German
districts the recent price changes can be ascribed to fundamental factors and are
not driven by speculative behavior. The increasing prices can rather be interpreted
as a catch-up process, especially because real estate prices did not rise the
decade before. Modelling different price and interest rate scenarios support this
explanation. Even a sudden and pronounced surge in interest rates would give
scope for a sharp price correction, which is typical for a bursting bubble. Thus,
the probability of an imminent real estate bubble is rather low. The low interest rate
could rather change housing consumption in general and lead to fundamental
structural changes in the German real estate market as homeownership becomes
more attractive in comparison to renting.
Keywords: Germany, real estate bubbles, user costs of housing
Paper Number:124 Market Research Analysis&Forecasting
G-3
94 ERES 2015 Conference 24-27 June 2015 Istanbul
Short-term Cycles in the Residential Market of Moscow
and St.Petersburg
Yuriy Kochetkov, Fund Development of Territories, Russia
Elena Grebenuk, Institute of Control Sciences, Russia
To date, the theory of housing market cycles is not well developed. Clearly, even
in general case the development of the models for cycle analysis involves
numerous interrelated and unresolved theoretical problems. As for Russia, we
face a lot of additional problems – lack of reliable data, existence of calculus in
two types of currency for real estate market, high influence of government
decisions and regulations on supply and demand. Anyway, residential property
cycles exist in Russia cities and could be detected and investigated by various
methods.
For large cities of Russia (Moscow and St.Petersburg) extensive data for housing
market have been accumulated and processed. In this paper, we explore the
following data: asking prices for apartments since 2000 year, sales volumes,
number of apartments on display at the market, share of mortgage in sales,
information about starts of new construction, etc. Using a panel of 15 year, we
examine the formation of housing market cycles, behavior in inflection point, their
amplitude and period.
The paper contributes to our understanding of housing market cycles in Moscow
and St.Petersburg in two ways. First, we found high influence of real
macroeconomic variables on market. The analysis suggests that results from the
housing market should be evaluated in the context of the overall economy’s
performance. Second, we discover the existence of short-term cycles in price
dynamic, inherent to own real estate market. The period of cycles is about 27
months in 2000-2009 and up to 40 months in 2009-2014. Presumably, unusual
turnaround took place in the residential market during 2008-2009 years crisis. It
would be noted the nature of the impact of fundamentals on residential market
changed in 2008/2009 too.
Will be considered separately hypothesis about the formation of the 18-year cycle,
where shot-term cycles are the part of general 18-year process.
Keywords: Market modelling, real estate cycles, time series
Paper Number:259 Market Research Analysis&Forecasting
G-4
ERES 2015 Conference 24-27 June 2015 Istanbul 95
Current Vacancy among Primary Schools in The
Netherlands
Daniël Vos, Grontmij, The Netherlands
Monique Arkesteijn, Delft University of Technology, The Netherlands
Clarine Van Oel, Delft University of Technology, The Netherlands
Hilde Remøy, Real Estate & Housing, Faculty of Architecture, Delft University of
Technology, The Netherlands
The number of children in the Netherlands is declining and will continue doing so
for the coming decade. Consequently, primary schools face vacant floor space.
Media reports state an alarming situation, without mentioning exact numbers on
the current scale of the problem. Nevertheless, it is very relevant since vacancy
costs public funds. This research concentrates on hidden vacancy, which is
defined as the situation in which a school uses the entire school building, while
not needing all available floor space based on government regulations.
The DAS-framework is used as a conceptual model to approach the problem.
Vacancy is a result of a mismatch between demand and supply. To calculate
vacancy, demand and supply must be known. Demand can be calculated, based
on amounts of students per school. However, the total supply is unknown, since
this information is decentralized. Until now only estimates of the current supply
are available, which vary between 10 M and 15,8 M m2. This makes it impossible
to estimate the current vacancy. To solve this knowledge gap, an extract from a
Cadastral database (BAG), holding information on Gross Floor Area and building
year, was matched with the addresses of schools as registered in a database of
the Office of Education. However, the raw version of this database held serious
limitations. Often information was clearly incorrect and a substantial number of
schools was missing. Therefore 100 municipalities were requested for additional
data. As a result the database is enriched with detailed object information of 18%
of the Dutch municipalities.
It was found that the current supply of primary schools is 9,6 M m2. This leads to
a national vacancy level of 7,9%. However, taking into account a friction vacancy
of circa 4% and the rent of floor space to third parties nuances this percentage.
Thus it is concluded that vacancy among primary schools is not as alarming on a
national scale as reported. However, it is also concluded that the demand will
decline in the coming years. The cost of this vacancy, corrected for a friction
vacancy of 4%, is between 6,7 and 17,5 M euro annually. If the supply is not
adapted to this changing demand, increase of vacancy is expected. For
academics, the findings of this paper nuance existing literature, give insight in the
current supply of primary schools and the scale of the current vacancy. Last it
provides valuable insights for future scientific use of Cadastral data and its
limitations.
Keywords: BAG, cadastre, current supply primary school buildings, public real
estate management, vacancy
Paper Number:58 Market Research Analysis&Forecasting
G-4
96 ERES 2015 Conference 24-27 June 2015 Istanbul
Testing for Bubbles in Turkish Housing Markets: A
Comparison of Alternative Methods
Yener Coşkun, Capital Markets Board of Turkey, Turkey
Ali Alp, TOBB University Economics and Technology, Turkey
H. Murat Ertuğrul, Undersecretariat of Turkish Treasury, Turkey
Ünal Seven, IMT Institute for Advanced Studies Lucca, Italy
Real estate economy has showed unusual performance in last decade in Turkey.
Growing house supply/sales, credit volume, and rising house prices have mostly
marked as boom. The perception of housing boom has also raised concerns
among local/inernational investors, consumers, and policy-makers. The objective
of the paper is to present the findings of the first comprehensive bubble analysis
of Turkish housing markets utilizing/comparing several alternative methods. In
order to address research questions, the study established two research
objectives, 1) To identify characteristic variables of a housing bubble analysis in
the context of Turkish housing market, and 2) To emprically measure whether
rising house prices have been justified by fundamental factors. The outcomes of
the study provides critical knowledges to domestic/international stakeholders of
Turkish housing (and real estate) market.
Keywords: Housing bubble, Turkey, house price, mortgage, residential market
Paper Number:170 Market Research Analysis&Forecasting
G-4
ERES 2015 Conference 24-27 June 2015 Istanbul 97
Universal Web Based Data Processing Model for Rental
Housing Profitability Calculation of Energetic Retrofitting
Jonas Hahn, University of Regensburg, Germany
Paul Bartsch, University of Regensburg, Germany
Sven Bienert, International Real Estate Business School (IREBS) University of
Regensburg, Germany
Doğan Kesdoğan, University of Regensburg, Germany
The current level of energy efficiency investments in the rental housing sector is in
danger of missing EU policy targets to be reached by the year 2020. It’s possible
that the goals are not being met due to a wide variety of reasons. Of great
importance are especially different economic and political conditions for energy
saving investments among the European member states. Furthermore the
respective legal regulation in many states might still lead to “split incentives’
barriers” e.g. the landlord-tenant disincentive in the rental housing sector. Also a
general lack of transparency and easy to process data is a core challenge for
market participants. Therefore it is important to create a unique framework in order
to assess the commercial viability of energy efficiency retrofitting in the rental
housing stock. Besides calculation tools and models the assessment also has to
take into account the inherent characteristics of the specific national rental
markets, rental regulations, tax regimes etc. In order to ensure that such an
approach is user friendly and widely used, a Web based solution will be needed.
In our paper we will present a Web based concept to collect, normalize and
process relevant data in order to ensure individualized results for the various
investors types, legal environments etc. For that reason we will present a general
network architecture using Web based technology. Here we put special emphasis
on user friendly data processing as well as privacy & security. Due to the fact that
the investment conditions for energetic retrofitting’s are varying considerably in
Europe and furthermore input data is not static we need a flexible automatic
processing tool that compute the data accordingly. For that reason we will present
efficient algorithms and a universal data model.
Keywords: Web-tool, energy efficiency, framework, privacy, security, usability
Paper Number:235 Market Research Analysis&Forecasting
G-4
98 ERES 2015 Conference 24-27 June 2015 Istanbul
Two Centuries of Farmland Prices in England
Arvydas Jadevicius, School of Real Estate and Land Management, Royal Agricultural
University, UK
Simon Huston, Royal Agricultural University, UK
Andrew Baum, University of Oxford, UK
The dissemination of robust real estate data helps to improve market efficiency.
Sound investment analysis requires long series to form a long-term view but,
whilst this has been available for the commercial sector, the same has not been
true for agricultural land. Comparable series on the long-term market position of
the farmland in England are fragmented. The current paper navigates the
methodological complexities involved in rectifying the land price information
deficiency. The study employs chain-linking approach to construct a long-term
farmland series for England. It then adjusts series for inflation to examine real land
market returns. The constructed 200 year series of English farm land prices
performance tightens analysis and enhances decision making.
Keywords: Chain-linking, England, farmland, prices, returns
Paper Number:32 Market Research Analysis&Forecasting
G-5
ERES 2015 Conference 24-27 June 2015 Istanbul 99
Market Research on Business Centre Concepts in The
Netherlands
Minou Weijs- Perrée, Eindhoven University of Technology, The Netherlands
Rianne Appel- Meulenbroek, Eindhoven University of Technology, The Netherlands
Bauke De Vries, Eindhoven University of Technology, The Netherlands
Sjoerd Romme, Eindhoven University of Technology, The Netherlands
New ideas about working and the work environment have caused the business
centre market to become more differentiated. Several new business centre
concepts focus on other aspects than merely offering office space, such as a
variety of services and facilities, support for enterprises to survive or grow, and
help in creating working communities. However, the business centre market is still
difficult to define, because it consists of several distinct types of properties and is
formed by many different players. Some of the existing literature has attempted to
classify the business centre market into several categories, but this has not yet
resulted in a clear taxonomy of different business centre concepts and their
characteristics. This study aims at developing such a taxonomy, based on data
collected among business centres in the Netherlands. The data are collected by
means of semi-structured interviews with real estate professionals. The findings
of this study give a clear overview of existing business centre concepts, their
characteristics and their (dis)similarities. These findings will help real estate
owners and developers to make well-informed decisions about the type of
business centres that they want to develop or invest in. In addition, the taxonomy
arising from this study can also guide organizations in selecting the business
centre that best fits their needs. The key contribution of this study is that it provides
a taxonomy of the business centre landscape.
Keywords: Business centres, concept development, market research, taxonomy
Paper Number:104 Market Research Analysis&Forecasting
G-5
100 ERES 2015 Conference 24-27 June 2015 Istanbul
Development Viability Indicators for UK Regions –
Construction and Evaluation of New Time-series Estimates
Neil Crosby, University of Reading, UK
Steven Devaney, University of Reading, UK
Peter Wyatt, University of Reading UK
Understanding development viability is an important issue for property market
participants and urban policy makers. In the UK, an extensive debate has arisen
surrounding how much developers should contribute towards local infrastructure
and the role that viability should play in setting such amounts. This debate is
hampered by a lack of good quality empirical data on either land values or
development viability in different areas. We attempt to address this problem by
applying a residual method for calculating site value in different areas using data
on values and construction costs stretching from the mid-1980s through to 2010.
Each estimate represents the price that would be paid to commence development
of a particular commercial property type at that time. Sometimes, the figures are
negative, indicating that development is not viable at that point. Hence, they do
not necessarily equal land value, as land values can reflect the option to develop
a site more profitably in the future. Nonetheless, they capture the viability of
development at different times and so are capable of informing policy makers in
regard to stimulating or taxing private sector development activity. The estimates
are undertaken for major towns and cities and then averaged across the locations
within each region. The resulting regional measure is then compared to data on
economic activity and construction output in order to evaluate the robustness of
the figures and understand the relationship between potential viability and
subsequent development activity in different areas.
Keywords: Construction activity, development viability, land values, residual
method
Paper Number:146 Market Research Analysis&Forecasting
G-5
ERES 2015 Conference 24-27 June 2015 Istanbul 101
Monitoring Commercial Property Prices during the Crisis:
Evidence from Greece
Vassiliki Vlachostergiou, Bank of Greece, Greece
Theodore Mitrakos, Bank of Greece, Greece
Calliope Akantziliotou, Bank of Greece, Greece
The recent economic swing caused by the financial crisis has had a severe impact
on commercial property prices in Greece. The already hard to monitor commercial
property market has become extremely illiquid and its investment indicators have
been distorted by low business activity, limited demand, very few transactions and
immediate need for liquidation by distressed owners. The objective of this paper
is to establish the most important determinants of commercial property rental and
open market values in Greece, within the crisis. Furthermore the particularities and
distortions of the market are highlighted along with the difficulty in monitoring its
trends. The paper concludes with a brief presentation of the recent effort of Bank
of Greece to produce commercial property price indices and its first results.
Keywords: Commercial property price indices, distressed market, investment
indicators, price determinants within a crisis
Paper Number:188 Market Research Analysis&Forecasting
G-5
102 ERES 2015 Conference 24-27 June 2015 Istanbul
European Real Estate Society Research Agenda: Looking
Back and Projecting Forward
Alastair Adair, University of Ulster, UK
Jim Berry, University of Ulster, UK
David McIlhatton, University of Ulster, UK
Bob Martens, Vienna University of Technology, Austria
Stanley McGreal, University of Ulster, UK
Now in its 20th anniversary year the European Real Estate Society (ERES) has
actively promoted quality-led research by creating a structured and permanent
network involving real estate academics and professionals across Europe. The
organisational structure within ERES supports the Society’s mission which is
dedicated to facilitating and advancing the discipline of real estate by raising the
quality, status and reach of real estate research and education. The Society aims
to fulfil its mission by providing different forums for constructive engagement by
academics, private sector stakeholders and public sector organisations within the
real estate discipline.
Adopting a truly European perspective to the rapid internationalisation of real
estate markets has increased in importance over the past two decades of the
Society’s history. Engagement in and co-operation with other national research
communities as well as our international sister societies links ERES to an extensive
network within the wider international real estate research community. In
accordance with the vision of the founding members of the Society, ERES remains
committed to creating added value for our membership, stakeholders and
sponsors. With a current membership of 700 members (2014), ERES is dedicated
to engaging with and continuing to support the development, application and out-
reach of high quality research across Europe.
This paper will consider the 20 year historical perspective in the development of
the research profile of the European Real Estate Society including change and
progression over time in the themes, topics and quality of real estate research.
Specifically the paper will consider the new emerging research focus and how the
objectives of the Society have helped facilitate its members in the production of
quality research. The paper will also project forward to determine the potential in
promoting a forum for the discussion and dissemination of real estate research.
Keywords: ERES, historial, perspective, themes, topics
Paper Number:90 Market Research Analysis&Forecasting
G-6
ERES 2015 Conference 24-27 June 2015 Istanbul 103
Identifying Lag Relationships in the Office Market with a
Turning Point Method during the Global Financial Crisis
Áron Horváth, ELTINGA, Hungary
Gábor Révész, Central European University, Hungary
Lead-lag relationships among office market indicators are essential to discover
for both theoretical and practical reasons. This paper identifies an approximately
one year lag between office market yield and new supply; a somewhat shorter
distance of rents and yields is revealed. According to the concluded calculations,
vacancy and take-up respond swifter to external shocks. We use the crisis as an
identifier, and detect reactions of turning points of the time series in a worldwide
database provided by DTZ.
Keywords: Forecasting, global database, global financial crisis, lead-lag
relationship, office market
Paper Number:197 Market Research Analysis&Forecasting
G-6
104 ERES 2015 Conference 24-27 June 2015 Istanbul
A Simulation Model to Minimise the Tracking Error
between the IPD Annual Index Estimate and the IPD
Annual Index
Charles Ostroumoff, Arca PRM Ltd, UK
Malcolm Frodsham, Real Estate Strategies Global Limited, UK
IPD Futures Contracts are traded on the IPD UK Annual Total Return Index.
Contracts traded during the year are priced using the standard Capital Asset
Pricing Model (CAPM) and incorporate pricing on the basis of the capital and
income performance for the year-to-date, plus the uncertainty as to the
performance of property for the remainder of the year. The IPD Monthly Index
provides an estimate of the current year-to-date performance. This paper outlines
a simulation technique for Property Portfolio Fund Managers, Risk Managers and
Multi Asset Managers to progressively (on a month by month basis) factor into
their estimate the tracking error between the IPD Monthly and IPD Annual Index.
Keywords: Derivatives, forecasting
Paper Number:216 Market Research Analysis&Forecasting
G-6
ERES 2015 Conference 24-27 June 2015 Istanbul 105
Economic Convergence in the EU and its Impact on
Property Markets
Dieter Rebitzer, Graduate Studies in Real Estate Nürtingen-Geislingen University Institut
Für Stadt, Germany
Mark Renz, Nürtingen-Geislingen University Institut Für Stadt Germany
Paolo Colucci, Nürtingen-Geislingen University Institut Für Stadt Germany
Since the Euro-crisis the cohesion and economic convergence within the EU are
questioned from what we derived our exploratory question: “Is there a
convergence between the members-states (EU-15) or not?” This will be evaluated
within the framework of an empirical analysis. In the first part of our paper we are
examining convergence terms and definitions (absolute-, β- and σ- convergence)
and their demarcations. Households, companies and nation-states are
considered. In the following Gossen’s Law, the Solow model and the principle of
subsidiarity are outlined and explained. On this foundation a comparison of the
convergence and divergence theories in reality will be drawn.
Keywords: Crisis, economic convergence
Paper Number:234 Market Research Analysis&Forecasting
G-6
106 ERES 2015 Conference 24-27 June 2015 Istanbul
Transaction Frequency and Property Price
Ke Qiulin, The Bartlett School of Planning, University College London, UK
Karen Sieracki, KASPAR Associates Ltd, UK
The frequency distribution of commercial real estate transactions by length of
holding period is not uniform. The distribution in transaction activity implies that
frequently and infrequently traded properties are associated with possible
clientele effects often associated with difficult to observe property and ownership
characteristics. However, repeat sales index as a metrics assume that frequently
and infrequently sold properties are similar in capital expenditures, maintenance
and other characteristics. Therefore, returns using repeat sales likely overstate
appreciation by misattributing this investment. In this paper, we investigate
whether the frequency and sales sequence matter in determining price
appreciation. We investigate whether the first sale of a repeat sale pair occurs at
discount to properties classified as single sale properties and the second sale
transactions of repeat sale pairs to sell for a premium to single sale properties.
The study will focus on London office market from 1991 to 2014.
Keywords: London office market, property price, transaction frequency
Paper Number:265 Marketing&Communication in Real Estate
H-8
ERES 2015 Conference 24-27 June 2015 Istanbul 107
Housing Co-operatives and Digital Democracy – Basic
Aspects and Empirical Evidence
Markus Mändle, Institute for Co-operative Studies (IfK), Nuertingen-Geislingen University
(HfWU), Germany
David Hummel, Institute for Co-operative Studies (IfK), Nuertingen-Geislingen University
(HfWU), Germany
Web 2.0 and social media revolutionized our communication and caused
extensive social change. In wake of this digital revolution the inherent notion of
democracy has changed. Increased demand for transparency, the readiness to
engage in dialogue and the opportunity to participate have shown that social
media increasingly impacts our democratic structures and decisions. Also
housing co-operatives were affected by these developments due to their
democratic structures and traditionally strong member relations. In this context
social media offers a multitude of opportunities for digital participation. This paper
shows the basic aspects of participation in digital democracy. It describes how
housing co-operatives can use these tools and mechanisms. However, this paper
also illustrates the risks that are connected to the use of digital participation.
Besides the theoretical aspects, also the results of an empirical survey is
presented. The survey determines the status quo of digital democracy within the
housing co-operative sector in Baden-Wurttemberg, Germany. In addition the
attitude of co-op managers regarding the risk and benefits of digital participation
was surveyed. The results show clearly that, so far only a few housing co-
operatives offer their members opportunities for digital participation. Furthermore,
the majority of the co-op managers express a skeptical view towards this new
form of media. However, at the same time co-op managers emphasize, that in
future the significance of social media and digital participation will probably rise
considerably.
Keywords: Housing co-operatives, social media
Paper Number:108 Market Research Analysis&Forecasting
H-8
108 ERES 2015 Conference 24-27 June 2015 Istanbul
Personality and Sales Performance
Yuen Leng Chow, National University of Singapore, Singapore
Seow Eng Ong, National University of Singapore, Singapore
Research in psychology and behavioral studies have shown that integrity
validation by way of meta-analysis is important in predicting job performance and
counterproductive job behaviors (Deniz, Chockalingam and Schmidt, 1993).
Dependability testing for personnel selection is also routinely carried out by
financial institutions and government agencies (Sackett, Burris and Callahan,
1989). The application of personality profiling for real estate salespeople is largely
absent in the literature save for isolated work (see Brinkmann, 2009). Thus, the
objective of this study is to carry out a personality profiling exercise for real estate
salespeople in Singapore and coupled with their corresponding observable
characteristics such as age, gender, qualifications, etc., to identify both an
empirical and personality profile of successful real estate salespeople in
Singapore. Using these results, we can further compare this profile with their
Western counterparts to check if there are cross-cultural differences.
The first phase of our study was carried out in December 2013. 185 respondents
from one brokerage agency firm took our 16 PF test. Out of these respondents,
25% (47 pax) were identified to be in the Top 300 ranking in terms of sales
performance. We are currently preparing to implement the second phase of our
study for respondents from two other agency firms.
In terms of methodology, we adopted the Sixteen Personality Factor
Questionnaire (16PF) developed by Raymond Cattell. The idea is that we could
better understand and predict human behavior using 16 narrow personality
descriptors (such as warmth, reasoning, emotional stability, etc.) and 5 broader
primary personality descriptors (such as extraversion, anxiety, independence,
etc.). We were able to match the subject’s personality indicators with observable
characteristics (age, gender, education level, number of years with company and
whether the salesperson joined from a different agency). We ran a probit model
using a dummy indicator of one to identify the top salespeople (Top 300 ranking)
as the dependent variable and the list of 16 narrow personality descriptors and
observable characteristics as the explanatory variables.
Our initial results indicate that in terms of observable characteristics, top
salespeople tend to be younger, more educated, and have stayed with the
company for a longer period of time. The last finding hints at a possible
survivorship bias; that is, only performing sales
Keywords: Cross cultural, personality indicators, successful salespeople
Paper Number:232 Marketing&Communication in Real Estate
H-8
ERES 2015 Conference 24-27 June 2015 Istanbul 109
Internet Search and Hotel Revenues
Prashant Das, Ecole Hôteliere de Lausanne, Switzerland
We examine if online information search trends reflect public interest in purchasing
hotel rooms. We introduce the trends into univariate forecasting models and
conventional structural models of room night stays and occupancy rates. We find
that on a monthly frequency, search trends are significantly reflective of future
room night stays and occupancy rates after controlling for known determinants of
these variables. Inclusion the trends significantly improve the weekly forecasts of
the performance fundamentals.
Keywords: Google searches, forecasting, hotel, rents
Paper Number:250 Market Research Analysis&Forecasting
H-8
110 ERES 2015 Conference 24-27 June 2015 Istanbul
The User Satisfaction and Usability of the Austrian Land
Register Real Estate App “LexioMobil”
Peter Sittler, Real Estate Institute for Real Estate Management FHWien University of
Applied Sciences of WKW, Austria
This research paper focuses on the practical use of real estate applications (RE-
Apps) concerning the Austrian land register. Apps are small programmes on
smartphones or tablets which are classified by their usage. One category is land
register. After the app “iEigentum/xEigentum” by the company Beinhofer other
regional clearing companies failed getting into the mobile market. With the app
“LexioMobil” by the company Medix a new land register application was released
in June 2014. The paper gives methodical comparison of land register
applications available in Austria based on the results of a quantitative survey to
determine user satisfaction and usability of real and effective users of this
application. The aim of the paper is to identify the relevant factors influencing the
user needs and to realize ways of using mobile land register apps to improve the
customer information and usability. The field of applications for real estate is not
well explored, especially quantitative explorations are not existing for the Austrian
market. This paper covers a structural and technological overview and a market
potential analysis of apps for the use of land register databases with a conclusion
of expected future developments in this field.
Keywords: Land register, new technology, real estate app, real estate marketing
Paper Number:287 Housing Markets&Economics II
HD4
ERES 2015 Conference 24-27 June 2015 Istanbul 111
House Price and Rent Developments in Istanbul: 1988-
2012
Ahmet Büyükduman, Istanbul Real Estate Valuation and Consultancy Inc, Turkey
The analysis regarding the housing prices could be made in the light of long-term
data. However, because the indexes that have been produced recently in Turkey
are limited to a short term, such long-term analysis could not be made. Building
backward housing price indexes by analyzing the factors that affect the
development of housing prices will bring about the analysis of not only the
dynamics of the domestic housing market within the country but also a
comparison of housing markets between our country and other countries of the
world.
The main purpose of this study is to close the gap of the index needed to evaluate
the movement of housing prices in the city of Istanbul. For this purpose, the data
about the sale and rent prices of houses within a selection of districts of Istanbul
between 1988 and 2012, a time span of 25 years was gathered to construct the
sale and rent index of houses. Proceeding from this index, the development of
sale and rent prices has been examined; the long-term trends and the short-term
fluctuations of housing prices have been determined and the interaction between
the change in housing prices and other economic variables has been researched.
In this study, it has been found out that the sale and rent prices are compatible
with the city model in the sense that it is closed in the short term and open in the
long term; that the housing supply in Istanbul has been elastic; that transportation
solutions which do not lead to space friction could be produced; that housing
prices move parallel to stock exchange and bond prices; and that there has been
no house price bubble.
Keywords: Asset price, house price indices, housing bubble, housing supply,
price to rent ratio
Paper Number:295 Housing Markets&Economics II
HD4
112 ERES 2015 Conference 24-27 June 2015 Istanbul
The Price-Turnover Relationship in European Housing
Markets
Marc Francke, University of Amsterdam, Amsterdam Business School, The Netherlands
This paper examines what determines the relation between prices and turnover in
European housing markets. We estimate this relationship using a panel vector
error correction model. We focus on the role of path dependency, direct feedback,
mortgage market indicators, and several other macro-economic indicators. We
find that there is particularly strong direct feedback between prices and turnover.
Also the mortgage market indicators, such as the outstanding mortgage loans to
GDP, play an important role. Prices, turnover, the outstanding mortgage balance
to GDP, and the level of GDP are cointegrated. Those markets with the strongest
feedback mechanism between prices and turnover are also those markets which
are the most volatile.
Keywords: Cointegration, credit constraints, nominal loss aversion, price-
turnover relationship
Paper Number:119 Housing Markets&Economics II
HD4
ERES 2015 Conference 24-27 June 2015 Istanbul 113
Residential Property Price Indices for Austria
Wolfgang A. Brunauer, Real(e)value Immobilien BewertungsGmbH, Austria
Wolfgang Feilmayr, Department of Planning Vienna University of Technology, Austria
Ronald S. Weberndorfer, Real(e)value Immobilien BewertungsGmbH, Austria
In this paper a new residential property price index (RPPI) for Austria a socalled
“spatial imputation index” is presented. The basic principle of this index is to
evaluate hedonic price models over all census tracts in Austria for representative
bundles of characteristics and to compare the results over time. By this it is
possible to aggregate on arbitrary spatial scales above census tract levels, taking
into account various perspectives on the housing market by applying different
weighting schemes for aggregation. Methodologically, we use Generalized
Additive Models (GAM), which account for possibly nonlinear functional
relationships using regression splines and for unexplained spatial heterogeneity
(beyond what can be explained by location covariates) using random effects. The
paper gives an overview over the methods and variables used for the hedonic
models and provides examples for the regional index on census tract levels all
over Austria. The results of the aggregated index are further used by the Austrian
central bank.
Keywords: Generalized additive model, hedonic index, nonlinear regression,
random effects, spatial imputation
Paper Number:230 Housing Markets&Economics II
HD4
114 ERES 2015 Conference 24-27 June 2015 Istanbul
House Price Determinants in Sydney
Xin Janet Ge, School of the Built Environment, University of Technology, Australia
Brendan Williams, School of Geography, Planning and Environmental Policy, University
College Ireland
House prices in Sydney have increased substantially over the last ten years. The
median price of established houses was $473,630 in 2003 and reached up to
$811,837 in June 2014, an increase by around 70 per cent. Many families are
forced into the rental market as they cannot afford to own a home at such high
prices. According to Demographia (2014), the Median Multiple (median house
price divided by gross annual median household income) for Sydney is nine
times, compared to 6.2 times in New York and 7.3 times in London. This research
studies the main determinants of house price increased in Sydney using the
quarterly data collected from Australian Bureau of Statistics and Reserve Bank of
Australia. By applying the multiple regression analysis, it is found that the
fundamental elements such as population growth, interest rate and the number of
house supply were the main factors that contributed to price increased for the last
ten years in Sydney.
Keywords: House prices, Interest rate, population, Sydney, house supply
Paper Number:351 Housing &History
HH7
ERES 2015 Conference 24-27 June 2015 Istanbul 115
Foundations and Real Estates of Yorguc Pasha Family
through The Ottoman Endowment System
Mustafa Çağhan Keskin, ITU Faculty of Architecture, Turkey
Amasya, an important Ottoman city in the 15th century, was governed by the tutor
of Sultan Murad II, Yörgüç Pasha (d. 1442) and later successively by Hızır Pasha
(d. 1466) brother of Yörgüç Pasha and Mehmed Pasha (d. 1494) son of Hızır
Pasha. Yörgüç Pasha’s family, who governed the city, contributed to the
reconstruction of Amasya region with their architectural patronage. Yörgüç Pasha
commissioned a complex consisting of a zawiya (a multi functional building for
worship and accommodation), a madrasa and an imaret (soup-kitchen) in
Amasya, several mosques in the towns near Amasya such as Havza, Vezirköprü,
Kavak and Gümüş, mektebs (elementary schools) in Tokat and Vezirköprü and a
tekke (dervish lodge) in the village of İshakalanı; Şahbula Hatun, Yörgüç Pasha’s
wife, commissioned a masjid, a fountain and a mekteb in Amasya; Mustafa Bey
(d. 1444), son of Yörgüç Pasha, commissioned a zawiya-imaret in Havza; Hızır
Pasha commissioned a complex consisting of a zawiya, madrasa and imaret in
Amasya, a mosque and a tekke in Samsun, a madrasa in Sonisa; Mehmed Pasha
commissioned a complex consisting of a mosque, a tabhana (rooms for
accommodation), a madrasa and an imaret.
The organizations, incomes and expenditures of these charity foundations, that
had been served free of charge, were clearly specified by the waqfiyas
(endowments) formed by the Yörgüç Pasha family members who had
commissioned them. The sources of income of these foundations were the tax
percents of several villages which the family had privilege on and the revenue-
generating structures commissioned by the family and endowed to them.
According to the waqfiyas, they commissioned four hans (caravanserais) one
bedesten (covered bazaar), several shops, six mills and eleven hammams around
Amasya to fund the foundations. Yörgüç Pasha commissioned a han, seventeen
shops and a hammam in Amasya, a han and hammam in Tokat and hamams in
Gümüş and İskilip; Mustafa Bey commissioned a hammam in Amasya, a
hammam and a han in Havza; Hızır Pasha commissioned a hammam in Amasya,
a mill in Ladik; Mehmed Pasha commissioned a hammam and a han in Samsun,
a hammam and a mill in Tokat, two hammams in Niksar, four mills in Amasya and
a bedesten in Tosya. This study aims to reveal the relations between the charity
foundations and endowed properties of Yörgüç Pasha family based on the
waqfiyas.
Paper Number:300 Housing &History
HH7
116 ERES 2015 Conference 24-27 June 2015 Istanbul
Byzantine Building Stock after the Conquest of
Constantinople in 1453
Bilge Ar, ITU, Architecture Faculty, Turkey
After the conquest of Constantinople by the Ottomans the population of the city
was found grossly lowered. Many buildings were already deserted before the time
of conquest. Mehmed II immediately started construction activities to build a new
Turko-Islamic capital. During his reign there was no ideological systematic
conversion of churches into mosques, the Byzantine building stock was used for
the new functions necessary to be fulfilled urgently. A new group of elites was
formed among soldiers who got richer by spoils of war and some buildings were
assigned to them to form the new neighborhoods. Needing people for
constructions Mehmed II took some extra ordinary measures to raise the
population including allowing the escaped locals of Constantinople to reoccupy
the buildings they left without paying taxes. He also called for Ottoman elites from
former capitals; Bursa and Edirne offering them priviliges such as occupying any
empty palace in Constantinople without payments. This paper deals with the
function change and ownership of Byzantine building stock after the Ottoman
conquest.
Keywords, Byzantine building stock, Ottoman usage, adaptive reuse
Paper Number:301 Housing &History
HH7
ERES 2015 Conference 24-27 June 2015 Istanbul 117
Property Issues of Istanbul Seawalls
Nisa Semiz, ITU, Architecture Faculty, Turkey
Istanbul Seawalls, prolonged along the northern and the southern shores of
historic peninsula, have been witnesses to all periods of historic Istanbul since its
establishment as a Greek colony at the tip of the peninsula. They were influenced
by the historical developments of the city as the other parts of Istanbul City-Walls.
During the Middle Ages, the defense system had repairs and renovations. Their
maintenance was not carried on regularly in the Ottoman era; yet the walls
survived the vicissitudes of time with their firm structures. Starting from the
sixteenth century, the martial importance of the city-walls decreased gradually
with the result of proliferation of firearms, and from the nineteenth century, they
lost their significance militarily. Then settlements developed in the immediate
vicinity of the walls, and some parts went into private ownership. Moreover
modernization of the city accelerated damages and losses on the walls. Today
only parts of Istanbul Seawalls are intact. Within this study, the history and the
current state of Istanbul Seawalls have been searched in terms of their ownership
status, and their property issues have been analyzed.
Keywords: Istanbul Seawalls, history, ownership change
Paper Number:255 Housing &History
HH7
118 ERES 2015 Conference 24-27 June 2015 Istanbul
Seventeenth Century Residential Real Estate Prices in
Istanbul
Ayşe Tuğba Şengil, Bosphorus International Real Estate & Investment, Turkey
This study is based on research about residential real estate prices of Istanbul in
seventeenth century. City of Istanbul which located both Asia and Europe has
history of approximately 9000 years. The earliest known settlement of Istanbul
dates from 6700 BC at the historic peninsula on European Side. City centre of
Istanbul in seventeenth century is also located in this area which is today known
as Fatih and Eminonu districts and they are part of World’s Cultural Heritage. In
seventeenth century, Istanbul had been part of Ottoman Empire since 1453. For
centuries it was the capitol of economics, social life and administration of the
Empire and then Republic of Turkey, although the last moved to Ankara after
republic is established, yet importance of the city did remain.
This study aims to determine how residential real estate market evolved in the
long-run with historical perspective. It has discovered that not many studies are
existed in the literature about real estates of Istanbul with historical perspective.
Additionally this study is also expected to contribute to create a background/basic
for further studies in similar subjects such as commercial real estates and different
timelines. In order to achieve that a database of sales prices of residential real
estates in Istanbul spanning the years from 1600-1699 are going to be put
together. Sale registrations of Ottoman Central Istanbul Islamic Courts of
seventeenth century provides a large scale of data about relevant subject. Using
this database, decade-interval chances in real estate prices are planned to
estimate. Moreover, reviewing effects of historical milestones to the house prices
during specified period is a goal.
As conclusion; in addition to appraising the residential real estate values of
seventeenth century in Istanbul, city of average 700.000 population, through
central districts, the city’s financial history is going to be explored, especially in
terms of city’s residential facilities.
Keywords: 17th century, grand bazaar, Istanbul, residential real estate, valuation
Paper Number:296 Performance & Risk Management
I-7
ERES 2015 Conference 24-27 June 2015 Istanbul 119
Office Market Response to Earthquake-Prone Building
Policy in New Zealand
Olga Filippova, The University of Auckland Business School, New Zealand
The Canterbury earthquakes caused significant disruption and destruction of
commercial premises. The effects of the earthquakes have spread across New
Zealand and seismic risk has become a significant issue for property owners and
tenants. The seismic strength of a building is now a major consideration for
tenants when making commitments to a long term lease. There are also examples
where building owners are investing in strengthening their buildings despite the
relevant legislation not yet having been passed by central government. The
framework for this research is that tenants and landlords preferences towards
existing buildings may change with regard to growing awareness of seismic
strength and this change in behaviour will be evident in the increased rental prices
in buildings with higher building standards. This research provides an empirical
investigation of the rental price differentials between seismically safe and
earthquake-prone buildings before and after the Canterbury earthquakes.
Keywords: New Zealand, earthquake, office market, price premium, rent
Paper Number:53 Performance & Risk Management
I-7
120 ERES 2015 Conference 24-27 June 2015 Istanbul
Efficiency Measurement of Swiss Shopping Centers Using
Data Envelopment Analysis (DEA)
Alexandra Bay, Center for Urban & Real Estate Management (CUREM), University of
Zürich, Switzerland
DEA as an Operations Research based linear programming approach for
evaluating the relative performance of homogenous Decision Making Units
(DMUs) is applied to Swiss shopping centers. Output-to-input efficiency ratios –
as for example the sales productivity – incorporate one output (sales) and one
input (sales area). Peer group comparisons (efficiency rankings) are difficult if
multiple inputs and / or multiple outputs of different kind of data (quantitative,
qualitative, categorical etc.) or measuring units (CHF, m2, %) are to be considered.
That is where DEA shows its advantages: DEA simultaneously handles multiple
input factors (e.g. sales area, parking lots, OCR) and multiple output factors (e.g.
sales, sales productivity, customer satisfaction) in a single efficiency measure –
without prior fixing the factor weights. Furthermore, DEA helps in evaluating the
DMUs (reference DMUs or benchmarks) that inefficient DMUs could refer to in
order to improve efficiency (input reduction and / or output increase).
The literature review focuses on real estate DEA applications and emphasises
property types whose efficient operation is crucial for valuation – as for retail
properties or for properties run by operating companies (hospitals, hotels,
shopping centers etc.).
The empirical analysis implements the Charnes-Cooper-Rhodes-Model (CCR
model), the Banker-Charnes-Cooper-Model (BCC model) and the Additive model,
and combines different shopping center performance drivers. Sales area and
sales are strong performance drivers. Ratios as factors show new insights, and a
DEA model including ratios could be an alternative to the widely used sales
productivity. By differentiating the factors between food and retail sales and food
and retail sales area, respectively, the efficiency of the shopping center sector mix
is assessed.
Practical implications using DEA as a benchmarking or rating tool – for example
in a Management Information System (MIS) – are given.
Keywords: Data envelopment analysis, efficiency, performance evaluation,
operations research, shopping centers, Switzerland
Paper Number:56 Performance & Risk Management
I-7
ERES 2015 Conference 24-27 June 2015 Istanbul 121
Ex-ante Real Estate Value at Risk Calculation Method
Charles-Olivier Amédée-Manesme, Université Laval, Department of Finance,
Insurance and Real Estate, Canada
Fabrice Barthélémy, CEMOTEV, Université de Versailles Saint-Quentin-en-Yvelines,
France
The computation of Value at Risk ($VaR$) has long been a problematic issue in
commercial real estate. Difficulties mainly arise from the lack of appropriate data,
lack of transactions, the non-normality of returns, and the inapplicability of many
of the traditional methodologies. In addition, real estate investment is difficult to
diversify and specific risk remains latent in investors' portfolio. It follows that risk
of the entire market does not correspond to risk an investor bears. Therefore the
risk measurements based on index do not represent the specific portfolio risk. As
a result, calculation of this risk measure has rarely been done in the Real Estate
field. However, following a spate of new regulations such as Basel II, Basel III,
NAIC and Solvency II, financial institutions have increasingly been required to
estimate and control their exposure to market risk. Hence, financial institutions
now commonly use ``internal'' $VaR$ (or Expected Shortfall) models in order to
assess their market risk exposure. The purpose of this paper is to propose a
model that incorporates real estate portfolio specificities in a real estate VaR
model.
Keywords: Real estate finance, regulation, risk measurement, value at risk
Paper Number:201 Performance & Risk Management
I-7
122 ERES 2015 Conference 24-27 June 2015 Istanbul
Regime Switching House Price Dependence: Evidence
from MSAs in the US
Andréas Heinen, Thema, Université de Cergy Pontoise, France
Mi Lim Kim, Thema, Université de Cergy Pontoise, France
Alfonso Valdesogo, Department of Economics, Universidade Federal Fluminense,
Brazil
In this paper, we analyze and model the dependence of house prices of
Metropolitan Statistical Areas (MSAs) in the US, taking into account the dynamics
of dependence. We model the dynamics in the dependence, using a regime
switching model with a two-state hidden Markov chain. We use a multivariate
Gaussian copula and a Canonical Vine copula to model the dependence of house
price changes of MSAs, and identify a high and low dependence regime, or a
symmetric and asymmetric dependence regime in the housing market.
Furthermore, we use interest rates and LTV as factors affecting the transition
probabilities of the Markov chain to see if those variables affect the change of
dependence between house prices. The main contribution of this paper is to
model dependence of house price returns of MSAs which can vary across time in
a flexible way using multivariate copulas and a regime switching model. Using
various multivariate copulas, we implement the variation of dependence across
time in terms of magnitude and shape into the model. First, we use a multivariate
Gaussian model with an equicorrelation for all pairs of MSAs, and estimate two
different equicorrelations which are for different two regimes with a regime
switching model. Through this estimation, we find a high and a low dependence
regime in the housing market among MSAs. Besides the magnitude of
dependence, we model different shapes of dependence for different regimes
across time using a Canonical vine copula and a multivariate Gaussian copula
with a regime switching model. The former is employed for an asymmetric
dependence or tail dependence regime, and the latter is used for a symmetric
dependence regime. In this paper, we verify a symmetric and an asymmetric
dependence regime for different time period. Besides, using macroeconomic
variables such as the change rate of interest rate (∆ r) and the change rate of Loan
to Value (∆ LTV), we see if these variables can explain different dependence
regimes across time in a better way. We find, especially, ∆ LTV is consistently
shown to be closely related to a high dependence regime. This partly shows the
vicious cycle between credit supply and house prices.
Keywords: Credit risk, contagion, copula, dependence, regime switching
Paper Number:98 Performance & Risk Management
I-8
ERES 2015 Conference 24-27 June 2015 Istanbul 123
Risks Assessment in Real Esate Investments: An AHP
Approach
Chiara D'Alpaos, Department of Civil, Architectural and Environmental Engineering -
University of Padova, Italy
Rubina Canesi, Department of Civil, Architectural and Environmental Engineering -
University of Padova, Italy
Purpose: Aim of the paper is to provide an ex-ante valuation model to address
risk and uncertainty in real estate investment decisions. We propose a model for
risks assessment that helps to evaluate risks and opportunities of real estate
assets taking into consideration different aspects of the project and related risks
(market risk, valuation risk, market growth risk, operating risk, etc.). Our main
objective is rather to provide research tools that reveal the riskiness of a property
investment than to provide an interpretative model.
Design/Methodology/Approach: Rigorous risk assessment measures, based on
mathematical algorithms, are here presented. Specifically, we propose an overall
risk scoring model to classify real estate investments’ riskiness and we propose a
procedure for a synthetic risks assessment that, based on the AHP model, will
help investors to manage risk exposure and opportunities in property investments.
Findings: We define the risk components and relative measures according to the
literature and experts in real estate investments. We determine each risk
component by implementing the mathematical algorithms provided. Then,
according to a pool of experts and financial managers’ judgments, we define the
thresholds to classify each risk component as conservative, moderate, aggressive
and finally we aggregate them into a synthetic overall risk index. Numerical
examples on urban development projects are presented in order to test the
effectiveness of the AHP model in supporting decisions and adapting strategies
to a permanently changing environment.
Research limitations/implications: We provide mathematical algorithms,
adaptable and interpretable, that can be generally applied in real estate
investments. The proposed model can be easily understood by third parties and
applied to different property types. Risk measures and relative thresholds may be
dependent on the investment (e.g. new development, renewal, etc.) and the
property type (e.g. office vs residential building, etc). As far as the scoring model
is concerned, the weighting has been identified with reference to the Italian
scenario, and similarly the classification of risks.
Originality/values: The risk assessment model here proposed may have
interesting effects in terms of risk management strategies. Results are transparent
and easy to be understood.
Keywords: AHP, real estate investments, risk assessment, uncertainty
Paper Number:192 Performance & Risk Management
I-8
124 ERES 2015 Conference 24-27 June 2015 Istanbul
Bootstrap Analysis for Asian REIT’s Portfolios
Enareta Kurtbegu, University of Evry Val d'Essonne, France
Juliana Caicedo-Llano, University of Evry-Val d'Essonne, France
A new bootstrap technique is applied to analyze the performance of a set of Asian
REITs and make selections based on the best performers. The cross-section of
Asian REITs being non-normal, these techniques are quite useful. The risk-
adjusted performance issued from traditional asset pricing models will be
analyzed with bootstrapping tools that will also allow controlling for multiple testing
problems usually encountered when analyzing the cross-section of returns.
"published in the “Handbook of Asian Finance,” edited by David Lee and
Gregoriou, 2014."
Keywords: Asian REITs, false discovery rate, bootstrap selection, control in
multiple testing, portfolio performance
Paper Number:211 Performance & Risk Management
I-8
ERES 2015 Conference 24-27 June 2015 Istanbul 125
Real Estate Market Risk Modelling
Mutale Katyoka, Department of Architecture and the Built Environment University of the
West of England, UK
Simon Stevenson, University of Reading, UK
The global financial crisis towards the end of the last decade saw an increased
interest in the role of risk management in the main stream financial investment
market. Among other things, the measurement and management of market risk,
credit risk and operational risk have become more pronounced than ever before.
Value-at-risk (VaR), a tool which assesses the maximum possible loss of an
investment, assuming a given confidence level, is widely used in the investment
world to measure market and credit risk. This measure has however come under
constant criticism as it only considers the maximum loss for a specific confidence
level and ignores any losses beyond that threshold, which could arise from
extreme events. Secondly, VaR assumes normal distribution of returns and yet
this is not the case with most financial returns, which have the added complexity
of being susceptible to the phenomenon of ‘fat tails’. (It should be noted however,
that it is only the basic version of VaR that has the normality issue and this can be
addressed through the use of Monte Carlo.) Thus, the credibility of VaR seems to
be losing ground. Though derived from the principles of VaR, the expected
shortfall (ES) is being forwarded as an alternative proposition due to its ability to
overcome some of the shortcoming of VaR, particularly when it comes to dealing
with tail risk. To this effect, the ES is being mooted as a tool for market risk
regulation, replacing VaR in the banking sector as proposed by the Basel
Committee on Banking Supervision. This said, the ES has its own challenges
especially because it cannot be subjected to back-testing due to its non-listable
attribute. Furthermore ES is also said to be quite sensitive to extreme values. In
the real estate market, very limited research has been conducted on modelling
market risk. This study therefore aims to investigate market risk modelling for real
estate and assess whether, and / or the extent to which, the expected shortfall
model offers a better alternative to VaR in terms of measuring market risk. Public
real estate has been chosen as the focus of the study as it is more amenable to
the application of VaR compared to private real estate.
Keywords: Expected shortfall, market risk, real estate risk, risk measurement,
value-at-risk
Paper Number:43 PPF, PPP & Infrastructures
J-8
126 ERES 2015 Conference 24-27 June 2015 Istanbul
Systematic Risk Factors in European Infrastructure Stock
Markets
Daniel Wurstbauer, IRE|BS, University of Regensburg, Germany
Stephan Lang, IRE|BS, University of Regensburg, Germany
Wolfgang Schaefers, IRE|BS, University of Regensburg, Germany
Christoph Rothballer, Boston Consulting Group, USA
This paper is the first to investigate the systematic risk factors driving European
infrastructure equity returns using traditional asset pricing models. As
infrastructure companies are exposed to specific risks such as regulatory
changes, a lack of product diversification and construction risks, the pricing
should differ substantially from that of general equities. Further differences are
expected, due to the monopolistic environment in which many infrastructure
companies operate. The major issue researchers face when analyzing
infrastructure stocks is the lack infrastructure indices with a sufficiently high
number of constituents and data history. Therefore, the data sample will be
constructed by retrieving all dead and active European stocks and subsequently
filtering them, based on the Standard Industrial Classification (SIC). Accordingly,
only stocks in the sectors of telecommunication, transport and utilities are chosen.
As the industry definitions include a large variety of economic activities in the
infrastructure sectors, such as service or product suppliers, the sample needs to
be screened in a second step for companies that focus mainly on “pure”
infrastructure business. This screening will be conducted on the basis of the
business descriptions retrieved from various data sources, such as Datastream
and Google Finance and annual reports (asset test and revenue test). As
indicated, the body of literature on asset pricing studies of infrastructure equities
is very limited. This is surprising, since investor appetite for infrastructure
investments and has grown significantly over the past few years. Consequently,
this paper contributes to our understanding of infrastructure equities. Portfolio
managers and investors can draw on the findings, in order to manage their risk
exposure more efficiently.
Keywords: Asset pricing, fama french, infrastructure investments, systematic risk
Paper Number:93 PPF, PPP & Infrastructures
J-8
ERES 2015 Conference 24-27 June 2015 Istanbul 127
Reasons for PPP in Poland - Taxonomic Analysis
Joanna Wegrzyn, Cracow University of Economics, Poland
Adam Nalepka, Cracow University of Economics, Poland
Agnieszka Telega, Cracow University of Economics, Poland
The aim of this paper is to determine the motives of PPP implementation in
municipalities. It was assumed that implementation of this kind of projects is
determined by the characteristics that can be aggregated into three areas:
availability of infrastructure, the size of the financial resources at the disposal of
municipalities, ability to finance investment project without exceeding the limits of
liability. A quantitative study of this relations was conducted with the use of
taxonomic analysis. The study failed to clearly resolve the problem of the impact
of infrastructure gap onto PPP decisions. The results confirmed that municipalities
have been experiencing negative phenomena of rising public debt. This threatens
the investment process. Research shows that PPP is perceived by the
communities as a remedy to the problems associated with obtaining finance for
investment.
Keywords: Infrastructure gap, investments, public debt, public-private partnership
(PPP)
Paper Number:145 PPF, PPP & Infrastructures
J-8
128 ERES 2015 Conference 24-27 June 2015 Istanbul
Risk Allocation in Implementation of Urban Development
Projects –Comparison of Finland, The Netherlands and
The UK
Eero Valtonen, Aalto University, Finland
Heidi Falkenbach, Aalto University, Finland
Kauko Viitanen, Aalto University, Finland
Erwin Van der Krabben, Radboud University Nijmegen, The Netherlands
Developing new neighbourhoods, both through greenfield and brownfield
projects, is risky business. These kinds of large scale urban development projects
can take several decades and contain high amount of both private and public
investments. Uncertainty concerning the time table as well as the overall
profitability of the projects is obvious. Development industry is usually also highly
regulated, at least in the developed economies. Albeit the property rights allowing
using, transacting and benefiting from a private property are usually secured by
law, the change of a property’s use is somehow regulated at the same time. The
main argument supporting this regulation is handling the externalities caused by
a particular use of a real estate, such as a polluting factory in the middle of a
residential neighbourhood. The regulation concerning planning and development
differs among countries, although the underlying argument is the same.
Our study aims to investigate the planning and development practices with the
perspective of risk allocation in urban development projects in Finland, in the
Netherlands and in the UK. These countries form an interesting group for
comparison because of their differences concerning planning and development,
i.e. the countries represent different planning systems according to urban
planning literature.
The main emphasis in the study is put on the risk positions of the municipalities
and private developers in the studied countries. To study the risk position the
legislation governing planning and development together with illustrative case
examples in each country are analysed. Special attention is paid to the roles of
the municipalities and private developers in planning the to-be-developed areas
and to the responsibilities of the municipality in the implementation of the plans
concerning the infrastructure provision. Together with the infrastructure provision
responsibilities it is discussed how the delivery of the infrastructure can be
financed.
Keywords: Development, infrastructure, planning, risk, urban
Paper Number:193 Real Estate&Regional and Urban Economics
K-1
ERES 2015 Conference 24-27 June 2015 Istanbul 129
Explaining Spatial Variation in Real Estate Development
Activity in Turkey
Elif Alkay, Istanbul Technical University, Turkey
Berna Keskin, University of Sheffield, UK
Craig Watkins, University of Sheffield, UK
There is a strong policy discourse at local and national level in Turkey that ascribes
considerable economic benefits to new construction activity. Critics, however,
argue that this policy discourse has led to a mismatch between public policy and
market fundamentals in many cities. It has been suggested that policy intentions
might be driving construction levels above demand levels and could be
contributing to uneven spatial development between regions. This paper seeks to
shed light on this argument by systematically exploring the relationship between
planning policy and development activity in 81 Turkish cities. The analytical
framework draws on research undertaken by Bramley and Leishman (2005) and
Henneberry et al (2005) on the relationship between public policy and market
outcomes and has been adapted to take account of the institutional arrangements
and policy instruments operating in Turkey. Drawing on data on economic activity,
local social indicators, planning permissions and applications, and demographic
change, the paper develops a cross-sectional econometric model that helps
isolate the effects of planning policy from other drivers of construction activity. The
second stage analysis uses to GIS methods and spatial statistics to develop an
understanding of spatial variations in the drivers of development activity. The
paper offers some tentative conclusions about the relationship between policy
imperatives, market fundamentals and development activity.
Keywords: Planning policy, real estate development, spatial variation
Paper Number:246 Real Estate&Regional and Urban Economics
K-1
130 ERES 2015 Conference 24-27 June 2015 Istanbul
A Study of English House Price Data with Spatial
Dependence
Ilir Nase, Delft University of Technology, Department of Real Estate and Housing, The
Netherlands
This paper exploits recent developments in spatial econometrics to investigate
local authority level house prices in England. It extends upon previous related
studies in three ways. First, the research overcomes the hurdles related to
boundary changes by focusing on a ten year dataset for the period 2004 -2013.
This is enabled through rigorous and systematic data mining to enable analysis
at the current level of 326 English local authorities (unitary and districts). Second,
based on urban economic theory, the model is expanded (with regard to previous
studies) to include economic and social variables. Finally, various specifications
of the weight matrix are tested for different levels of spatial dependence and
theoretical insights from the fields of regional and urban economy.
Keywords: Average house prices, English local authorities, spatial dependence
Paper Number:251 Real Estate&Regional and Urban Economics
K-1
ERES 2015 Conference 24-27 June 2015 Istanbul 131
Socio-Spatial Transformation by Gated Communities on
the Peri-urban Areas
Melike Karaca, ITU Regional Planning Master Programme, Turkey
Aliye Ahu Akgün, Istanbul Technical University, Turkey
“Some walls are meant to keep people in, some to keep people out” (Blakey &
Snyder, 1997) After 1980s, especially in 2000s the establishment of new
settlements in Istanbul, named as gated communities and the increasing numbers
is the result of not only globalization but also taking into account housing
production and marketing as one of the main development strategy. Another
reason is that the developers and producers in the housing sector consider
Istanbul as an open market. Due to the demand for luxury housing and prestigious
life, which means also demand for both vertical and horizontal gated
communities, the increasing number of such settlements is inevitable. Depending
on this high demand, gated communities do not only appear as a housing
production type but also as a new lifestyle. Some people prefer to fulfil their aim
to have a prestigious life in the urban centre, while some prefer to live in the peri-
urban zones away from urban centre in contact with nature and the lifestyles
offered by gated communities. On this basis, in order to supply this demand,
developers prefer more peri-urban areas, in other words rural areas. This type of
housing production in rural areas has created socio-spatial transformations in the
uniqueness of the rural areas. The research will focus on Göktürk where gated
communities in Istanbul first appeared. The socio-spatial transformation of
Göktürk will be analysed by first social transformation via population, education
level and employment via data obtained from TURKSTAT. In addition, the spatial
transformation will be estimated by aerial photos of 1987, 1996, 2005 and 2010 in
order to understand the changes in transportation, streets, green areas, gated
communities and housing.
Keywords: Istanbul, gated communities, peri-urban areas, socio-spatial
transformation
Paper Number:65 Real Estate&Regional and Urban Economics
K-2
132 ERES 2015 Conference 24-27 June 2015 Istanbul
Agglomeration Economies and Global Cities: The case of
London, New York and Relativity
Lynne Michael, School of Architecture and the Built Environment School of Architecture
and the Built Environment London South Bank University, UK
This paper evaluates the manner in which agglomeration influenced formation of
cities and how this has changed with the evolution of ‘global cities’. Furthermore,
a study of global cities concentrating on London and New York, investigating the
sales turnover of commercial real estate, is undertaken to investigate any changes
in relativity.
Changes in capital flows recorded in commercial real estate transactions over
time will be analysed using market data supplied by RCA for each city sector
studied. As a consequence of electronic communications and reduced costs of
travel, earlier predictions were made of the ‘end of geography’ with reference to
ending the importance of strategic fixed locations. Despite this, studies of
agglomeration reveal that once a path dependency is established, a self-
augmenting process with existing structure and infrastructure, direct contacts
between firms, local information flows, joint use of facilities and provision of
venture capital provided by existing firms in the location, maintains a local
momentum. Firms create their own ‘externalities’ in a location resulting in positive
effects on that industry. Whether this can continue to maintain or extend the life of
an international financial centre has not been studied in great depth. In recent
years the global network of world cities has undergone some alteration in balance
of activity. A number of cities from developing nations are playing an increasingly
significant part in global economic activity.
The research confirms the significance of cities as a global base for business has
not declined. However, agglomeration economies in the new wealth producing
firms in global cities have altered from those important to former wealth producers
in manufacturing. Furthermore, technological development has manifested vast
changes in global competitive and economic advantages altering balances
accordingly.
Keywords: International financial centre, agglomeration economies, global cities,
sustainability, technology
Paper Number:78 Real Estate&Regional and Urban Economics
K-2
ERES 2015 Conference 24-27 June 2015 Istanbul 133
How Dutch Municipalities Manage their Community Real
Estate
A. (Annette) Tjeerdsma, Hanze University of Applied Sciences, The Netherlands
Jan Veuger, Hanze University of Applied Sciences, The Netherlands
In the Netherlands, the amount of square meters of community real estate is
estimated between 83 and 85 million square feet. Although these are only
estimates, the numbers give an indication of the extent of Dutch community real
estate. Due to its size it can be stated to be a segment that covers an important
part of the real estate market. However, it seems that community real estate is not
yet always managed in a professional way since owning real estate is in most
cases not the core business of the owner (mostly municipalities and other non-
profit organizations). Because community real estate is financed with public funds
and the real estate is physically located in the middle of the society, it is a subject
of discussion in the Netherlands and therefore subject of our research in the past
seven years.
The problem addressed in this paper is which trends can be recognized in the
way Dutch municipalities deal with their community real estate.
In order to describe these trends, municipalities were asked to complete a
questionnaire about the way they manage this type of real estate. From 2008 until
2014 (except for 2013) the municipalities completed the questionnaire with an
average response rate of 23% (14%-37%). The questionnaire developed over time
and contained approximately 30 to 45 questions. Most of the questions were
repeated and some were added, deleted or adjusted due to current developments
and feedback of respondents.
From the answers given on the questionnaire, many results can be showed and
conclusions can be drawn. 49% of municipalities are currently experiencing
problems in conducting community real estate tasks and a majority (63%) is not
yet ready to outsource their core functions. If municipalities are considering this,
they only do this on operational tasks. 92% indicates that the separation of
housing costs and operating expenses are a current theme. Many municipalities
(56%) do not take measures for financial risks. 40% has both a bureaucratic vision
as a municipal property policy, whereas 33% has neither of these. In the short
term, municipalities consider another way of organizing their community real
estate tasks. The number of municipalities that measures technical quality, user
satisfaction and the contribution of community real estate to policy objectives has
increased.
Keywords: Community real estate, municipalities, real estate management, The
Netherlands, trends
Paper Number:103 Real Estate&Regional and Urban Economics
K-2
134 ERES 2015 Conference 24-27 June 2015 Istanbul
Measuring the Added Value of Housing for Primary
Education
Dirk Kootstra, Hanze University of Applied Sciences, The Netherlands
Ing. Jan Veuger, Hanze University of Applied Sciences, The Netherlands
Purpose: The purpose of this paper is to develop an instrument that provides
insight in the added value of a school for primary education, from the perspective
of different stakeholders. The following groups are considered stakeholders:
municipality, school board, environment, parents and children. An instrument like
this is needed in order to be able to measure the effect of an intervention within
an experiment. The intervention is about decentralizing the available financial
resources from the municipality to the school boards.
Design/Methodology/approach: In order to find a measuring instrument, a
literature study has been done to the aspects on which added value can be rated
for the different stakeholders. Since "value" has a different meaning for the various
stakeholders, these aspects have been searched for in literature related to various
fields, namely Business Administration, Finance, CREM and FM. The instrument
will be calibrated in a follow-up study using interviews. In addition, the Delphi
method will be applied.
Findings: The research has given information that can help build up a usefull and
well founded instrument to measure the added value of school buildings for the
different stakeholders. Apart from the financial issues (such as costs per square
meter), which are interesting only to part of the stakeholders, other aspects were
found that can help measure the perceived value for the other stakeholders (such
as: employee satisfaction, innovations, flexibility, market share, etc). Furthermore,
is seems desirable to apply real estate strategies with regard to (portfolios of)
school buildings.
Originality/value: There are no publications yet on instruments that measure the
added value experienced by different stakeholders with regard to school
buildings. In practice, financial exploitation of school buildings when it comes to
value is only about book value and depreciations. By measuring the added value
(for the other stakeholders) through other aspects as well, one gets a better overall
picture of the actual output of the building. With the insights gained through this
measurement, a more extensive initial investment in a school building might be
justified. The instrument can also be of value during negotiations on
spending/dividing financial means for housing between school boards and
municipalities. Thus, the value of this instrument is more comprehensive than just
the use of it in the experiment that will be carried out in the framewor
Keywords: Primary education, Real estate, added value, measurement,
stakeholders
Paper Number:144 Real Estate&Regional and Urban Economics
K-2
ERES 2015 Conference 24-27 June 2015 Istanbul 135
Knowledge Spillovers in Cities: The Creation and
Transmission of Knowledge
Johannes Stiller, University of Regensburg, Germany
Dirk Assmann, University of Regensburg, Germany
We analyze knowledge spillovers in a search-theoretic spatial equilibrium
framework with workers who are heterogeneous in knowledge type. Knowledge
spillovers result from random face-to-face interactions between workers in the city.
The outcome of those interactions crucially depends on the combination of the
interacting individuals' knowledge types. In contrast to previous work, we explicitly
model knowledge spillovers as the interplay of two channels: knowledge
transmission (imitation) and knowledge creation (innovation).
Our results show that if the role of innovation is sufficiently important, individuals
choose an excessively narrow range of partners to interact with, leading to lower
than socially optimal creation of new ideas, which results in socially inefficient
city sizes.
Keywords: Agglomeration, innovation, knowledge, learning, matching
Paper Number:266 Real Estate&Regional and Urban Economics
K-3
136 ERES 2015 Conference 24-27 June 2015 Istanbul
The Impact of Mass Transit System on Property Values in
India
Anil Kashyap, RICS School of Built Environment, India
Jim Berry, University of Ulster, UK
The capitalisation of transit access in property values has long been investigated
by property researchers and policy analyst. A premium in property price induced
by transit services measures the rate of capitalisation and indicates positive
impact of transit investments, which can be used to develop transit-based policies
such as value-capture and transit-oriented development strategies. Land
development impacts of mass transit have long been studied in the developed
economies. Yet relatively little is known by the outside world about the Indian
experience due to India’s rather short history in the development of mass transit
and real estate market. This paper attempts to fill the gap by presenting evidence
from India, with a detailed case study of Jaipur Metro Rail Corporation by selecting
two transit lines in Jaipur, the study examined land development context and
estimated hedonic housing price models to measure the proximity premiums
associated with these metro lines. The empirical evidence shows that investments
in mass transit can have significant and positive impacts on land development.
Properties with transit proximity enjoy sizable price or value premiums. The
research findings underscore the importance of introducing zoning and other land
regulatory changes prior to the initiation of transit projects as well as applying
value-capture tools to help finance investments and redress inequities.
Keywords: Capitalisation, transit, land development, property values, value
capture
Paper Number:42 Real Estate&Regional and Urban Economics
K-3
ERES 2015 Conference 24-27 June 2015 Istanbul 137
Regional Emerging Hubs - Catalysts, Drivers and
Constraints
Simon Huston, Royal Agricultural University, UK
Most economic development over the next fifty years is likely to be centred on
regional towns. Many of regional conurbations are ill prepared to cope with growth
pressures. Others are more geared up for ‘smart growth’. Some regional
settlements have aspirations to become 'knowledge hubs' to attract investment
and generate prestigious local jobs. University status or expansion is one
promising regional development catalyst. Urban beautification projects can also
help to attract foreign talent or retain local skills and avoid the stigma associated
with 'dormitory suburbs' or cultural deserts. However, the metamorphosis of
conservative regional market towns into vibrant knowledge Arcadias confronts
philosophical, forecasting, institutional, housing and funding constraints. The
research outlines the contested urban renewal backdrop and applies an
environmental scanning and systems framework to it. In its empirical phase, the
research investigates how catalysts, drivers and development constraints
manifest at the local level in the case of two expanding regional English
conurbations - Hereford and Cirencester.
Keywords: Environmental scanning, knowledge hubs, partnerships, regional
development, smart growth
Paper Number:118 Real Estate&Regional and Urban Economics
K-3
138 ERES 2015 Conference 24-27 June 2015 Istanbul
The Impacts of Real Estate Projects on Transformation of
Centres in Izmir
Merve Kaya, Department of Real Estate and Planning, İZKA, Turkey
Ferhan Gezici Korten, Department of City and Regional Planning, Istanbul Technical
University, Turkey
The term real estate has exerted direct impacts on the urban finance and macro-
form in changing economies of the world cities. This paper examines the urban
dynamics of İzmir as candidate for brand city which explain how the city has
developed by major projects.
Izmir has been famous as a trade center ever since it’s past history. In recent
years, most of the efforts have been made to make the port city famous in service
facilities again. The aim of the paper is to analyze the development process of
central districts within the city of Izmir and to examine the role of real estate
projects. During the time of ever-increasing uncertainty, a question gets more
pertinently than ever: Will the main three districts maintain the reliability of the city
economy in equilibrium through new planned service-based functions. Therefore
a survey was conducted including interviews with the project developers who
operated major investments in Konak, Bayraklı and Karşıyaka districts.
The decision-making and implementation process, and challenges to become the
central districts are related flexible, adaptable and fast-changing economy. The
findings of the research put forward that the interest of the capital and the basic
strategies of the plans and investments do not overlap. After strategic regional
land use plan and other upper scaled plans have been realized, developers are
expecting that the study area will attract significant real estate projects which have
mixed use functions with various forms. Originality/value - This is the first paper to
examine urban dynamics of the centers in İzmir from the perspective of real estate
development for better understanding to relationships between brand city vision,
urban macro-form and major projects.
Keywords: Brand city, major projects, real estate, transformation, urban centres
Paper Number:141 Real Estate&Regional and Urban Economics
K-3
ERES 2015 Conference 24-27 June 2015 Istanbul 139
How Shall the Governance of the Urban Renewal Projects
at Historical Sites be Performed? – Example of the Izmir
Kemeralti District
Buğra Kağan Esen, Ankara University, Turkey
In the last decade, experiences in urban renewal projects have enabled a
systematics, which help overcome physically worn out urban areas. Every urban
renewal project shall have a different origin and resolution model just like every
city has different natures and requisites. Any given urban renewal project shall
have a tailored governance model for its spatial problem solving and desired
project intention.
Most of the time, such move in historical districts is to put forward the old original
profile of the district. Apart from all other factors, these projects aim aesthetical
concerns. It is intended to obtain a better appearance and respect for the former
urban lifestyle.
The historical Izmir Kemeralti Project, endeavored for a while, is a good example
for such situation. Pioneered by the local authorities and some civil organizations,
this project is remarkable by many aspects. The subject district, which is still very
active, has been the merchandising center and downtown location of Izmir since
forever. Not only for Izmir, but also for the whole Western Anatolia region, it is a
junction of the complete informal retail center. Meanwhile, for this region where
very valuable historical buildings exist, it is disfavored by many Izmirians that the
region has become home for the unpermitted sellers and unorganized vendors.
The intended renewal project aims to elevate the class of the still-strong trade
activities in the region as well as to reveal the historical buildings.
In this paper, a management and governance model is probed for the Project
mentioned above. A quick view shows, the area is privately owned, property
values have skyrocketed and the merchandising activity is pretty intense. In that
case, the chance of performing eminent domain is out of question, also in the
sense that it might undermine the intensity of the day-to-day businesses. And so,
a relation between the public authority, entrepreneurs and the landowners shall
be well organized to properly renew the area. This research is focused on the
governance dimension and the business planning of this Project.
The contribution of this research to urban sciences may be twofold. First, it
contains advice for renewing historical downtown areas when governance
techniques are considered. Second, it provides notion for applying negotiation
methods for the tremendously valuable urban renewal areas, whether they are
historical or not.
Keywords: Mathematical modeling, commercial property, historical district,
property values, urban renewal
Paper Number:80 Real Estate&Regional and Urban Economics
K-4
140 ERES 2015 Conference 24-27 June 2015 Istanbul
Short-term Rentals and Housing Rents. The Case of
Airbnb in Berlin
Nicole Braun, University of Regensburg (IREBS), Germany
Philipp Schäfer, University of Regensburg (IREBS), Germany
Airbnb (ABB) offers short-term rentals for tourists via an online-market platform. In
contrast to traditional holiday lodgings the flats are usually residential apartments
or rooms, offer fewer services and are therefore mostly cheaper. The phenomenon
of ABB can nevertheless also trigger spillovers to non-participants and is currently
being debated extensively in several German cities. The prevailing view: The
urban housing markets are concerned with a diminution of housing supply and
increasing rents. The central point thereby is, that due to ABB a large part of
residential flats is removed from the housing market. Several providers divert their
flats illegally into permanent holiday flats and do not just offer the flats occasionally
as is intended by the share economy. Berlin is the largest ABB-market in Germany
and especially here individual buyers have discovered the conversion from rental
flats into holiday flats as a specific investment scheme. This paper aims to analyse
the coherence between the ABB-density and housing rents in the different
neighbourhoods of Berlin with a simple 1-W ANOVA. Furthermore, the web data
of ABB is analysed with respect to illegal usage.
Keywords: Airbnb, housing rent, short-term-rental, urban tourism
Paper Number:116 Real Estate&Regional and Urban Economics
K-4
ERES 2015 Conference 24-27 June 2015 Istanbul 141
Housing Economics and Changing Residential Quality in
Berlin
Kristin Wellner, TU Berlin, Germany
Friederike Landau, TU Berlin, Germany
Claus Müller, TU Berlin, Germany
Berlin is a growing city. Almost 48,000 people permanently moved to Berlin in
2013, and the number of national and international tourists is constantly rising: 30
million tourist overnight stays are expected in over 700 tourist accommodations in
2016. This massive influx of people challenges the existing built capacities,
leading to a tense housing market with increasing rents, selling prices and
standard land value, especially in attractive inner-city neighborhoods. The
politicization of real estate development and rent prices has produced several
regulatory housing policy measures such as the increase of the land purchase tax
(2014), Subpoena on the Prohibition of the Misuse of Living Space (2014), and
Rent Control (2015). The development of Berlin’s real estate market into one of
the most attractive capital investment markets took place at unprecedented
speed: inter alia, the transformation of rental property into condominiums or the
transformation of residential into commercial usages, vacancy rates have
decreased to around 2 percent today. These developments have resulted in a
strongly articulated demand for new (residential) constructions requesting about
20,000 additional dwelling units in Berlin. In a four-field-matrix developed
elsewhere (Landau/Wellner, 2014), the variable of ‘tourist accommodations’ (TA)
is being examined as influential factor on the changing residential quality in inner-
city residential neighborhoods in Berlin, where tourism has an increasing impact
on both economic development as well as on social cohesion. Tourism has
evoked resentment and protest amongst some residents of areas that are heavily
frequented by tourists. The variable TA is divided into an official or formalized
accommodation segment, i.e. hotels and hostels, as well as an informal sector,
i.e. privately-rented sublets or vacation rentals whose number is estimated at
12,000 in all over Berlin. The dimensions of residential quality will be differentiated
into built features (location, quality of building etc.), economic (rent level, tenant
mix etc.), social (neighborhood atmosphere, security, fluctuation etc.), ecological
and health-related (noise, pollution etc.) aspects, thus contributing to the
conceptualization of ‘residential quality’.
Keywords: Housing economics, housing policy, rent prices, residential quality,
tourism
Paper Number:236 Real Estate&Regional and Urban Economics
K-4
142 ERES 2015 Conference 24-27 June 2015 Istanbul
Impact of the Rent Brake on German Housing Markets
Dieter Rebitzer, Nürtingen-Geislingen University, Germany
Paolo Colucci, Nürtingen-Geislingen University, Germany
Mark Renz, Nürtingen-Geislingen University, Germany
In recent years, the demand for housing and hence rents in most growing German
areas has steadily increased. In order to limit the rise in rents a new instrument,
called rent brake, was introduced. The process was accompanied by
controversial discussions among market participants, economists, and political
parties. Finally, the new law was passed in 2014.
According to the new rent act special rights will be granted to the federal states of
Germany. They will be able to restrict the rents charged for re-letting in certain
designated areas where housing demand and rents are high. In these areas,
landlords will not be allowed to increase the rent beyond a maximum of 10%
above the customary comparative rent.
This discussion paper attempts to examine the legal, economic, social, and
political aspects of the German rent brake. Firstly, the impacts based on an
economic standard model are analyzed. The result of this analysis speaks clearly
against the rent brake. Secondly, legal problems at execution level are identified.
On the basis of market data it is shown that only a small part of Germany is really
affected. Also this fact speaks against the rent brake, mainly due to unsolved
implementation details. Thirdly, social policy aspects are taken into consideration.
The findings show that the rent brake is perceived positive by most voters. It
suggests the impression that the government does something for the tenants.
Fourthly, from a strategic standpoint Merkel (CDU/CSU) wins at the expense of
the coalition partner (SPD) and the opposition (Alliance 90/The Greens, THE
LEFT), who originally developed the idea.
Keywords: Comparative rent, housing policy, rent act, rent brake, social policy
Paper Number:134 Real Estate&Regional and Urban Economics
K-5
ERES 2015 Conference 24-27 June 2015 Istanbul 143
Does Land Fragmentation Delay the Implementation for
Urban Renewal?
Ding Hsiu-yin, Department of Land Economics, National Chengchi University, Taiwan,
R.O.C.
Land fragmentation is deemed to be a significant factor in delaying land
development especially for integrating an urban renewal project. One strategy to
identify urban renewal area is that the landowners designate the renewal units by
themselves in accordance with the criteria as determined by the local authority.
They may apply for implementation of the urban renewal business of that area in
keeping with the regulations. However, land assembling always takes a long time
in processing an urban renewal business so as to not all renewal units are
successful led to successful urban renewal businesses. How long will a renewal
unit take to implement an urban renewal business is crucial for successfully
implementing urban renewal projects. In this study the time that renewal units take
to implement urban renewal businesses and why they do were analyzed.
Keywords: Land assembly, land fragmentation, renewal unit
Paper Number:150 Real Estate&Regional and Urban Economics
K-5
144 ERES 2015 Conference 24-27 June 2015 Istanbul
Industrial Decentralization as a Real Estate Development
Project: Gebze Case
Ayşe Nur Albayrak, Gebze Technical University, Turkey
Gebze has gained its industrial identity by the decentralization of industrial firms
from Istanbul throughout the years and become one of the most important
industrial centers in Turkey. But recently, transformation of industrial areas has
come to the urban agenda in Gebze. In this context, the aim is to decentralize the
industrial areas and to transform into qualified residential - urban facility areas.
There are numerous examples of transformation of industrial areas in Istanbul and
in other major cities in the literature. The area in Gebze (D-100 Road and its
immediate surroundings), however, is a special case for including active
manufacturing units and for the size of its scale. Such transformation will modify
not only the industrial facility areas but also the social structure, production
relations in the industry and employment structure in the region. Thus, the regional
industry is expected to transform into high technology sectors. “The Information
Valley” is about to established in addition to existing research institutions such as
Gebze Technical University, GTU-TEKMER, TUBITAK-MAM and also GOSB
Technopark.
This area has been declared as a “special project zone” in various urban and
regional planning documents but the priority of such transformation on the other
hand has not been clarified yet. The purpose of this study is to discuss the effects
of urban transformation offered as a real estate development project on the city
of Gebze. Following the introduction chapter presenting a theoretical framework
for urban transformation, the second chapter reviews planning documents and
compares foresights about Gebze. Interviews with the Chamber of Commerce
and other local actors are presented in the third chapter. This chapter is organized
in three headings. These are effects on production relations, modification of the
labor structure and social vulnerabilities. The final chapter presents evaluations
and recommendations for policy makers. It is important to demonstrate positive
and negative aspects of possible effects of urban transformation on Gebze and
to create an environment of discussion which ensures participation of local
players. It is not possible to succeed in such a large scale transformation without
the contributions of local actors.
Keywords: Gebze, industrial transformation, urban transformation
Paper Number:184 Real Estate&Regional and Urban Economics
K-5
ERES 2015 Conference 24-27 June 2015 Istanbul 145
Ethnic Mover Flows and Neighborhood Change in
Scotland
Jessie Bakens, University of Sheffield, UK
Gwilym B Pryce, University of Sheffield, UK
In this paper we describe the role of ethnicity in spatial patterns of mover flows in
Scotland by focusing on the ethnicity of movers in relation to the ethnic
composition of neighbourhoods. Many cities are becoming more and more
ethnically diverse. Within cities however, neighbourhood population composition
might not always reflect this diversity as clustering, segregation, but also mixing
of ethnic groups predominantly takes place on lower spatial levels. For individual
residents, the ethnic population composition of a neighbourhood might therefore
become an increasingly distinctive and important feature for the comparative
evaluation of residential locations. If the ethnic population composition of a
neighborhood plays a role in individual location decisions, compositional
preferences are most likely related to one's own ethnicity. Understanding this
mechanism in the process of residential location decisions will ultimately help us
to better understand ethnic neighbourhood dynamics.
For the analysis in this paper, we use a unique combination of datasets on a very
fine-grained spatial level. We link the Registers of Scotland house transactions
data between 1990 and 2010 with the Scottish Neighbourhood Statistics. The
ethnicity of house buyers is identified by (sur) name analysis. There is a rich
literature on using onomastics to identify ethnicity, and this approach can
overcome some of the drawbacks inherent in using other ways of identifying
ethnicity like, for example, country of birth.
Adapting a gravity model of spatial interaction, we model spatial patterns of mover
flows of different ethnic groups in Scotland and neighbourhood compositional
change. Spatial interaction models offer a systematic approach to describe the
role of neighbourhood population composition in determining location patterns of
different ethnic groups.
Keywords: Ethnic mover flows, neighborhood dynamics
Paper Number:46 Real Estate&Regional and Urban Economics
K-6
146 ERES 2015 Conference 24-27 June 2015 Istanbul
The Restructuring of the UK Urban Retail Hierarchy and
the Consequences for Real Estate Investment
Colin Jones, Heriot-Watt University, UK
Nicola Livingstone, Bartlett School of Planning, UCL, UK
Over the last thirty years or so a new dispersed sub-regional urban system has
emerged in many developed countries. Key accessibility relationships have been
transformed leading to a ‘rationalisation’ of the retail hierarchy that has seen large
centres grow and out of town centres developed at the expense of small town
centres that have gone into decline. There is little hard evidence on this trend but
there has been a large increase in clothing and footwear stores in UK regional
centres with a parallel decline in sub-regional and town centres over the period
1998-2010. These phenomena have given rise to the term polycentric urban
region and urban networks with an implied shift away from a central places
hierarchy. Some of the long term culminations of these trends have been stressed
in a series of well publicised reports, notably The Portas Review. This paper will
examine the consequences for real estate rents and investment by analysing the
long term changes in rent levels of local centres within a (evolving) central place
framework. The primary data are ‘standard’ high street rents on a quarterly basis
from 1984 of more than 400 towns provided by CBRE.
Keywords: A new central place, Rent shifts, retail hierarchy, urban change
Paper Number:88 Real Estate&Regional and Urban Economics
K-6
ERES 2015 Conference 24-27 June 2015 Istanbul 147
Behavioral Real Estate. A Literature Review
Costin Ciora, The Bucharest University of Economic Studies, Romania
Evidence of the impact of behavioral analysis in real estate has become clearer
during the real estate market bubble, and prior to that, when irrational exuberance
affected the movements in this market. The purpose of this paper is to comprise
a literature review of behavioral real estate, looking closely on the concepts and
potential for analysis.
Keywords: Behavioral analysis, behavioral real estate, irrational exuberance, real
estate economics
Paper Number:179 Real Estate&Regional and Urban Economics
K-6
148 ERES 2015 Conference 24-27 June 2015 Istanbul
Developing Resilient Property Markets in the Wake of the
2008 Economic Crisis
Gheorghe Petru Multescu, School of the Built Environment & Architecture London
South Bank University, UK
Ala Daugeliene, Faculty of Civil Engineering and Architecture Kaunas University of
Technology, Lithuania
Building cities capable to withstand adverse conditions generated by climate,
environmental, resource- or community-driven vulnerabilities is part of a global
response aiming to strengthen our cities through enhancing their adaptive
capacity of reaction. However, world city rankings identified above do not address
specifically enough a modern-day threat to our cities: economic disasters.
Sustainable urban development and resilient urban economies depend on the
strength of property markets and subsequent construction sectors.
The 2008 credit crunch and subsequent economic recession have had a
devastating impact on some of the European property markets. Some of the
Central Eastern European (CEE) emergent markets have been mostly affected by
a chronic lack of finance, poor government and governance and high perception
of risks and vulnerability to investors in real estate. Property markets instability has
affected local economies, local communities and urban and regional
development.
Institutional investors and market analysts are aware of the prospect of another
potential property market crisis within the next decade. In the current weakened
EU economic context growth has been limited and austerity measures have come
into strong conflict with economic investment requirements. Developing a set of
factors that contribute to property market resilience to economic cycles and future
recession should therefore become a priority for the local governments and
investors in Europe.
How can emergent property markets become more resilient and what are the
lessons that emergent property markets can learn from developed property
markets in order to enhance their adaptive capacity of reaction to economic
disasters?
The research aims to develop a model for appraising property market resilience
in European capital and regional cities. Developed property markets were
analysed in order to establish specific factors that helped them become more
resilient to economic disasters. Lessons to be learnt and mistakes to be avoided
are considered for the development of more resilience as part of CEE emergent
property markets.Establishing a successful model for appraising resilience in
emergent and developed property markets will ultimately help with establishing a
long-term European capital and regional city index of property market resilience
as a tool for managing urban resilience to future economic disasters.
Keywords: Central Eastern Europe, city resilience, emergent property markets,
property cycles, crisis, property markets resilience
Paper Number:249 Real Estate&Regional and Urban Economics
K-6
ERES 2015 Conference 24-27 June 2015 Istanbul 149
Retail Rents and Spatial Patterns of Product Variety in
Urban Shopping Areas
Tony Shun -Te Yuo You, Real Estate and Built Environment National Taipei Univesity,
Taiwan, R.O.C.
This research aims to examine the spatial patterns of product variety and its
relationship with the rental values for urban shopping areas. In order to reveal the
complexity of various spatial structures of shopping areas, this research
establishes a spatial hierarchy product variety database. The basic model applies
the concepts from the Central Place theory, Bid-rent model to connect related
indexes of spatial complexity, product variety and rents. The database includes
three major components: 1) using GIS to generate basic spatial characteristics
information variables and the spatial indexes will be generated from space syntax
software, such as Depthmap or Axwoman; 2) product variety data from a detailed
survey of sampled shopping areas and shopping districts; and 3) a detailed rental
data so as to generate retail rental gradient of shopping areas. The preliminary
results show that certain spatial patterns of product variety dominants the rental
market, and it is not the greater the general variety the higher the rent.
Keywords: GIS, high-street stores, retail agglomeration economies, retail
porperty, spatial analysis
Paper Number:262 Real Estate&Regional and Urban Economics
K-7
150 ERES 2015 Conference 24-27 June 2015 Istanbul
Real Estate Valuation use in Urban Transformation
Projects
Mehmet Akif Levent, IMM Urban Transformation Directorate, Turkey
Semih Adil, IMM Urban Transformation Directorate, Turkey
Ayşe Gökbayrak, IMM Urban Transformation Directorate, Turkey
In Istanbul, existing built up areas are threat against many natural and urban risks.
Concurrently, these urban spaces have often economic, social and physical
scarcities. There is a necessity for urban transformation projects in these slum
areas to meet today’s urban space needs also to provide a livable city. Built &
Transfer & Evacuate model was developed to realize these urban transformation
projects. Built & Transfer & Evacuate is a model that can be used on empty, state-
owned urban development areas. Any essential public areas such as green areas,
regional parks, public health facilities, educational facilities etc. can be planned in
these urban spaces within the master plans for these areas. Due to the model, the
buildings those built on the state-owned areas will be bartered for the existing risky
buildings which are in the nearest areas. After demolition of the buildings in these
areas new master plan studies will be done on the risk-free ones to provide a
sustainable urban transformation. Therefore, planned, livable urban spaces will
be created. To define the contribution values of the property owners in urban
transformation areas, real estate valuation studies should be done. In general, the
value of the existing and new built buildings had defined to state the distribution
value of the project. Before the master plan and design studies, land-real estate
valuation studies should be completed to have the most suitable functions for the
areas and to have the best localization of them within the defined criteria.
Keywords: Built, transfer, evacuate model, Istanbul, real estate valuation, urban
transformation
Paper Number:275 Real Estate&Regional and Urban Economics
K-7
ERES 2015 Conference 24-27 June 2015 Istanbul 151
Does 3D Information Modeling Give Better Vision to Deal
with Future Real Estate Capacities of Inaccessible Areas
within Conflict Zones?
Mohsen Shojaee Far, Center of Land Policy and Valuations (CPSV), Polytechnic
University of Catalonia, Spain
Carlos Marmolejo Duarte, Valuation and Land Management Research Centre (CPSV),
UPC University, Spain
Changes in technological paradigm regarding the information modeling of
geospatial data (geomatics) brought significant possibilities of virtual simulation
of urban environments via aggregation of information from different sources into
a geometric model. These capacities have been used in many different disciplines
from military and governmental uses to commercial systems, such as satellite 3D
models of different areas (i.e. Google Maps) or GIS data and BIM models.
Considering this technological possibility as a tool of visualization of urban
components, for urban planning purposes and real estate evaluations, provides
an integrated system of management, integration and distribution of complex
urban geo-information. As an alternative use of such systems, this study explores
the capacities and advantage of using information modeling approaches for
simulating the inaccessible areas within geopolitically conflict zones (either by
legal or physical restrictions-geopolitical brownfields) to provide a visual
presentation of current physical conditions of given areas. This approach may
also open possible visions on potential future real estate capacities of those
affected areas and its peripheries, where more accurate and reliable development
and regeneration proposals may produce accordingly. Correspondingly a
methodological framework of data collection (aggregation of information) and
also simulations suggested, which consequently may deliver more efficient
decisions on future real estate market capacities to decision makers (authorities),
real estate experts, and urban planners.
Keywords: Geopolitics and conflict zones, inaccessible areas, information
modeling, real estate capacity, virtual reality
Paper Number:311 Real Estate&Regional and Urban Economics
K-7
152 ERES 2015 Conference 24-27 June 2015 Istanbul
Relationship between Urban Development and Housing
Values: The Example of Konya
Mehmet Topçu, Selcuk University, Turkey
This study aims to examine the effects of public or private sector based urban
investment on housing values which are in the environs of these kinds of
investments. For this purpose, the study uses totally 13 parameters including 5
parameters related the properties of housing structure, 7 parameters related
environmental properties and accessibility parameter. At the last 15 years, two
regions are in the forefront where urban investments have important impact in
Konya which can be seen as a catalyst for the rapid development of the city. For
this reason, these areas were chosen as sample. The first sample area is at the
north new-developing side of the city. This area has many new investments like
shopping mall, gated housing projects, stadium, fairground etc. And, the second
sample is at the east side of the city which has also many transformation areas
and investments (law court, private university, hospital, urban park, shopping mall,
etc). In this context, for measuring the structural and environmental properties of
housing units, a total of 200 questionnaire was applied to the housing units by
using random sampling technique. Information regarding economical values of
housing units was obtained from real estate companies. These derived data were
evaluated by statistically. In conclusion, the results from the evaluations showed
that building age, housing unit size, density, safety-security, accessibility, having
parking lots and having elevator parameters are significantly effective on housing
values.
Keywords: Konya, urban development, housing values
Paper Number:109 Real Estate&Regional and Urban Economics
K-7
ERES 2015 Conference 24-27 June 2015 Istanbul 153
Diversity Analisysis: The Case of Barcelona Metropolitan
Region
Juan Camilo Echavarria Ochoa, Valuation and Land Management Research Centre
(CPSV), UPC University, Spain
Carlos Marmolejo Duarte, Valuation and Land Management Research Centre (CPSV),
UPC University, Spain
There are many aspects that adds economic value in a metropolitan region.
Among them and as a methodological approach of this paper it has been
included the diversity measurement and its quantitative analysis. Given the
positive and regulating capabilities of diversity in the urban systems, an analytical
model has been developed in order to assess the distribution of housing prices
using variables that allows calculating diversity in an economical and territorial
basis. The parameters involved are variables such as land use, the distribution of
employment, the income level of the population, transport accessibility, among
others. The methodology adopted focuses on assess different variables and its
internal diversity as a measure of both the balance and abundance of pre-
constructed indicators. From the above it is possible to draw conclusions of the
importance of its inclusion in metropolitan systems planning.
In the case of the metropolitan region of Barcelona (RMB) and its 164
municipalities the study show that diversity of located employment, diversity of
economic activity including income levels and diversity of land uses are highly
positive factors which have a direct influence in the metropolitan setting, making
a difference on residential market values.
Keywords: Shannon index, diversity, entropy, job commuting, real estate value
Paper Number:264 Real Estate Development
L-5
154 ERES 2015 Conference 24-27 June 2015 Istanbul
The Polish Real Estate Market as an Area for Developers
Magdalena Zaleczna, University of Lodz, Department of Investment and Real Estate,
Poland
Rafal Wolski, University of Lodz, Department of Investment and Real Estate, Poland
The Polish real estate market have coped with an economic slowdown quite well.
However, some sectors and localisations developed in different pace. The authors
would like to describe some factors influencing the conditions of the real estate
market and its current level of development. Having this background the authors
would like to analyse financial results of developers dividing them into different
categories. The authors would like to find what kind of developers have found the
best solutions and strategies in changing economic environment.
Keywords: Developer company, financial condition, real estate
Paper Number:29 Real Estate Development
L-5
ERES 2015 Conference 24-27 June 2015 Istanbul 155
Innovative Finance for Real Estate Development in Pan-
European Regeneration
Graham Squires, University of Birmingham, UK
Norman Hutchison, University of Aberdeen, UK
Alastair Adair, University of Ulster, UK
Stanley McGreal, University of Ulster, UK
Samantha Organ, The University of the West of England, UK
Following the Global Financial Crisis (GFC), the role of finance in real estate
development for regeneration requires re-examination. The research presented in
the conference paper draws on research funded by the Royal Institution of
Chartered Surveyors (RICS), which focused on how and whether real estate
development has become more innovative following the GFC - with particular
reference to regeneration from a pan-European perspective. The findings show
key financial factors and emergent funding mechanisms, whilst a comparative
analysis of three case studies based across Europe (London, UK; Leiden, The
Netherlands; and Berlin, Germany) provide greater insight on the similarities and
differences between projects that can be considered new and possibly innovative.
Findings demonstrate that there has been growth in the blend of financial
products used in real estate development for regeneration across Europe. This
blend is set with greater equity financing, often sourced from institutional funds
from domestic and foreign consortiums. Additionally, partnership structures
adopting a collaborative-competitive ethos have been adopted - particularly by
those beginning to use large-scale multi-bank finance. The emergence of project
bonds also set the tone for a more infrastructure-specific nature of funding when
uncovering innovative finance for real estate development in pan-European
regeneration.
Keywords: Equity, finance, innovative finance, real estate, regeneration
Paper Number:91 Real Estate Development
L-5
156 ERES 2015 Conference 24-27 June 2015 Istanbul
Cognition Biases in Real Estate Investment Decisions.
Empirical Evidence from the German Development Market
Kevin Meyer, TU Darmstadt Department of Law and Economics, Germany
Andreas Pfnür, TU Darmstadt Department of Law and Economics, Germany
Cognitive biases have been intensely studied in security markets so far (Simon
1987). Flyvberg (2005) also found, that project management decisions in the
construction of infrastructure suffer from cognitive biases. In the field of real estate
development investment decisions no empirical analysis of these social-
psychological effects like miscalibration (e.g. Zacharakis/Sheperd, 2001), over
optimism (e.g. Heating, 2002) or escalating commitment (Staw/Ross 1987) are
known so far. A lot of actual large scale projects like the new Berlin Brandenburg
Airport or the new Hamburg Opera House Elbphilharmonie, which is one of the 10
most expensive single building project developments of the last years gives a lot
of impressionistically evidence, that the cognition bias of project investment
decision makers is one of the most important reasons for running out of time and
costs.
Therefore we develop a model of cognition biases in real estate development
decision situations containing the most relevant biases and the key types of
decision makers and situations. Real estate development decisions differ from
security investments, because there are several parties who work together in one
relatively long lasting project, while they can physically see the project and it’s
success grow.
In a large-scale empirical survey among all types of real estate project decision
makers (e.g. sector, hierarchy, personal experience) we analyze and compare the
individual degrees of cognition biases with methods coming from the empirical
social research. We measure cognition biases and their specific reasons. The
results of several univariate and multivariate analyses show heavily cognition
biases in real estate investment decisions, which vary intensely between different
types of decision makers. Especially in real estate development decisions the
degree of bias depends on the individual objective and subjective knowledge and
the incentives of the decision maker. We also found evidence that the degree of
the bias in decision situations, which results in inefficiency, is not given, but can
reduced by far. So we are able to derive some methodological implications for
theory and practice in the field of efficient institutionalizing the project.
Keywords: Cognition bias, decicion making, real estate development, real estate
invesmtent, risk management
Paper Number:178 Real Estate Development
L-5
ERES 2015 Conference 24-27 June 2015 Istanbul 157
Integrating Interests: Consumers-Retailers-Investors
Cath Jackson, University of Sheffield, UK
Allison Orr, University of Glasgow, UK
The retail sector underpins many local and national economies, yet is
experiencing a prolonged period of change and uncertainty. Securing successful
large-scale retail-led developments within town and city centres can be key to
economic success and stability, yet is a challenging and complex process. This
is exacerbated during times of change, with the decision-making environment
faced by investors undergoing dynamic transformation driven by changing
consumer behaviour, retailer rationalisation and concerns over the accessibility of
these traditional public places. The role of the city centre is being challenged and
the aspirations of multiple user groups and stakeholders need to be revisited to
seek to ensure the future-proofing of the next generation of retail developments.
The role of the city centre faces challenges from the evolving behaviour and
objectives of consumers and retailers and, in turn, each group comprises
diversity. Consumers, for example, include user groups such as leisure users,
workers, drinkers, diners, tourists, arts and culture users, the third sector,
socialisers, service users, residents and, of course, shoppers (within both
comparison and convenience sectors). Within each of these categories,
behaviour has changed due to shifts in working hours, commuting patterns, utility
of central public spaces, disposable income and, importantly, multi-channel
internet shopping. Similarly, the characteristics and objectives of retailers have
changed, with expansion in store numbers, store sizes and, more recently,
retraction in representation with consequent changing requirements for space. It
is within this diverse and complex context that the role of the city centre is
explored.
A model is developed to provide a comprehensive yet accessible representation
of the diversity of user groups and stakeholders, their relationships, aspirations
and the environment within which they operate. At its core it shows investors and
depicts the challenges they face in terms of situating risk within the opportunities
represented by the catchment of users (occupiers and consumers) and satisficing
the diverse aspirations of the catchment. It is argued that such a model can
progress our understanding of the role of the city centre and, thus, may be an
important input into investor decision-making by contextualising user group and
stakeholder relationships, aspirations and pressures, enabling alignment of retail
developments and urban regeneration goals.
Keywords: City centre, decision-making, future-proofing, investment, retail
Paper Number:269 Real Estate Development
L-6
158 ERES 2015 Conference 24-27 June 2015 Istanbul
Project Management in Real Estate Development Projects
Nurbanu Türgen, Epos Property Consulting and Valuation PLC, Turkey
Real estate development projects are hierarchical and sequential processes
which are needed to be considered and analyzed by focusing on several
disciplines. Getting through the real estate development projects in right time, with
planned objective quality and budget is the general purpose; however, it is not so
common to perform it perfectly. In real estate development projects, it is very
important contribution to planned objectives that keeping the project
management approach remain on agenda and using it as a tool. In today's
conditions, implementing an idea of real estate development is possible with
efficiency in leading, management and organization. Concordantly in this study
all parts of the real estate development projects that are the idea inception and
refinement; feasibility; preconstruction; construction; stabilization have been
handled as the processes of initiating; planning; executing; monitoring and
control; closing. Real estate development processes in such a unity have been
analyzed through the field of project management knowledge areas. In this way,
finding out which knowledge areas have priority in each real estate development
process has become possible.
Keywords: PMI methodology, project management, project management
knowledge areas, real estate development, real estate development
processes
Paper Number:272 Real Estate Development
L-6
ERES 2015 Conference 24-27 June 2015 Istanbul 159
The Success of PPPs in Poland
Joanna Wegrzyn, Cracow University of Economics, Poland
Michal Gluszak, Cracow University of Economics, Poland
The construction and provision of infrastructure services is often based on a
partnership between public and private sector under a framework of Public Private
Partnerships (PPPs). This type of partnership has been employed in Poland since
2009. Though public-private partnerships in Poland are a relatively young and
promising investment model, they are still poorly developed. As a result, only a
small numer of projects (20%) managed to get funding. Given this observation,
the objective of this paper is to examine how economic and political
characteristics contribute to the success of PPPs. We examine a database with
PPP projects using a generalized linear model in the form of a logit model in order
to find out what factors exerts impact on PPPs success in Poland.
Keywords: PPPs, logit model, project success
Paper Number:26 Real Estate Development
L-6
160 ERES 2015 Conference 24-27 June 2015 Istanbul
Staff Housing: Panacea to Academic Productivity
(Nigerian Institutions)
Jovita Nnametu, Nigerian Institution of Estate Surveyors and Valuers African Real Estate
Society, Nigeria
Iheanyi Alaka, Nigerian Institution of Estate Surveyors and Valuers (NIESV) Nigeria
Derek Fidelis Chikezie Okoronkwo, Nigerian Institution of Estate Surveyors and
Valuers (NIESV), Nigeria
Purpose: Housing issues bother every living human especially workers who cover
long distances to their work places. This paper attempts to examine the effect of
housing proximity on the workers productivity as it relates to tertiary institutions in
Nigeria. This is with the view to proposing effective and workable staff housing
that will enhance institutional productivity especially for the academics, as the
tertiary institutionsaremeant to be citadels of higher learning per excellence.
Design/Methodology/approach: The cross-sectional survey design was adopted
to elicit relevant data that will guide the researchers' proposal for improving
productivity among academics of the selected tertiary institutions in Imo State, via
staff housing scheme. A multi-stage sampling procedure consisting of quasi-
probability sampling approaches for the survey. Appropriate tables and data
analysis techniques were also employed in explaining the field results.
Findings: Findings focused on the difficulties faced by these staff as a result of
distance from home to workplace; academics' attitude to work in relation to
productivity and its impact on student-staff relationshipvis-a-vis learning
outcomes and identification of suitable staff housing strategies for the selected
institutions.
Originality/Value: The outcome provides a framework for improving workers
productivity in Nigerian Tertiary Educational Institutions through staff housing. It
serves as a warning guide to the Nigerian government and other private investors
while prioritizing institutional structures towards enhancing workers' productivity
and creation of strong synergy among the stakeholders of tertiary academics.
Keywords: Tertiary institution, academics, productivity, staff housing, synergy
stakeholders
Paper Number:298 Real Estate Development
L-6
ERES 2015 Conference 24-27 June 2015 Istanbul 161
Analysis of the Retail Market Development in Bratislava
with a Focus on Retail Function and its Wider Relations
within the City
Andrej Adamušcin, Slovak University of Technology, Institute of Management, Slovakia
The aim of the contribution was to analyse the development of shopping centres
in Slovakia with the main focus on Bratislava in relation to the localization,
structure, supply of premises, capabilities of shopping centres. The study
analyses the system of shopping centres, its influence, importance and impact on
their surroundings. This contribution is also dealing with retail function as such
and with its wide relation with another functions and its position within the city as
such.
The contribution in its analytical part is predominantly focused on bigger retail
schemes within the city and their influence on the city life in various aspects in
spatial planning frame. Conceptual part solves two various concepts of retail
development in the city as well as special one which is dedicated to the
development of new High Street scheme on lower scale. The contribution is not
dealing only with physical structure as such but on the contrary reflects market
standards as well as market situation.
Main outcomes from the contribution are related with analysis of development of
shopping centres in Bratislava and also with new approach how to solve the
spatial planning in terms of retail as the function as such is closely linked with the
market and absolutely depends from participants on the market as well as
participants on the market are depended on the spatial planning.
Keywords: Development, retail function, retail market, shopping centers, spatial
planning
Paper Number:292 Real Estate Development
L-8
162 ERES 2015 Conference 24-27 June 2015 Istanbul
Measuring the Effect of Unobservable Factors in
Residential Choice Behaviour
Berndt Lundgren, Royal Institute of Technology, Sweden
Fan Yang Wallentin, Uppsala University, Department of Statistics, Sweden
Previous research has shown that it is likely that residential choice behavior is
mostly affected by unobservable factors. The purpose of this research paper is to
investigate the effect of heterogeneous unobservable factors in residential
developments on residential choice behavior using exploratory and confirmatory
factor analysis.
Our results show that there are significant effects of unobservable factors on
residential choice behavior. The methodology presented can be used to advise
developers, architects or planners in evaluating those attributes that create value
to improve, for example, the overall design solutions in real estate development
projects.
Keywords: Residential choice behavior, real estate development, structural
equation modeling
Paper Number:200 Real Estate Development
L-8
ERES 2015 Conference 24-27 June 2015 Istanbul 163
Residential Infill Development – The Connection between
Inhabitants’ Attitude and Areal Characteristics
Martina Bendová, Aalto University, Finland
Saija Toivonen, Aalto University, Finland
Helsinki Metropolitan Area is a growing region with rising demand for housing.
The low density of housing, which is very often visible in Finland and in other
Nordic countries, bears great potential for infill development to conquer or at least
ease the growing need for housing. Densification is often argued to be one answer
to the environmental pressures the built environment is coping with. The main
argument is that, densification of residential areas will make better use of existing
infrastructure and decrease travelling. In addition to the positive environmental
impacts, the infill developments are argued to have societal benefits such as
diversification of population and land use, and increased vitality of the area. Infill
development can also bring economic benefits to various parties. At the same
time that the city is seeking savings in infrastructure construction and
maintenance costs, housing companies may also receive financial means from
the construction of a new building on their property. This income can potentially
cover costs needed for example for energy and pipe renovations, and lift
construction.
In Finland where the level of owner-occupancy in housing is high, home owners
can be seen as key players when discussing new infill developments. While the
public sector sets the frames, eventually much is in hands of the real estate owner
and inhabitant. Even though the impact of infill developments has been studied
thoroughly, little is still known about the willingness or unwillingness of inhabitants
to support infill development in their neighborhood. The topic deserves more
attention, as infill development projects often face opposition from the inhabitants,
despite the many known benefits.
The aim of this study is to find connections between characteristics of areas and
their inhabitants’ attitude towards infill development. The results can give a better
understanding of inhabitants’ appreciations. This knowledge could be applied in
urban planning processes to support infill developments in the future. The
inhabitants’ attitudes are examined using a questionnaire survey. The survey was
carried out in the Helsinki Metropolitan Area, and the extensive questionnaire
received opinions from 1088 respondents. The inhabitants’ attitudes towards infill
development are compared to different areal characteristics to reveal their
interconnections and significance.
Keywords: Areal characteristics, densification, housing, infill development,
inhabitants attitude
Paper Number:206 Real Estate Development
L-8
164 ERES 2015 Conference 24-27 June 2015 Istanbul
The Impact of Planning on Business Development
Huub Ploegmakers, Institute for Management Research, Radboud University, The
Netherlands
Pascal Beckers, Institute for Management Research, Radboud University, The
Netherlands
This paper explores the relationship between planning policies and the
performance of the industrial property market. There has been a growing research
interest in measuring the impact of planning and land-use regulations on property
market outcomes. Nevertheless, at least three main limitations have been
highlighted in the literature that constrain the development of a stronger evidence
base. These are insufficient attention for the impact of planning at the micro-level
of supply, a relative lack of studies that assess the impact of planning on other
than housing markets (i.e. office, retail, and industrial property markets) and
inadequate consideration of the potentially varied impacts of different types of
planning intervention. This research attempts to improve on these limitations by
adding results from two novel datasets. The first contains information on individual
building permits for a sample of Dutch municipalities who have given us access
to their data. The data cover the period from 2004 to 2008. This permits an
analysis of investment activity at the micro-level, looking at building investment at
the level of individual sites allocated for industrial uses. The second dataset
consists of a range of indicators that capture different dimensions of planning
intervention. These indicators reflect the main policy actions and initiatives
deployed by (local) governments in the Netherlands in order to influence business
development. A model has been developed to estimate the effect of these
planning indicators on investment activity in industrial buildings. The results
provide some evidence of the negative effects on new construction often
associated with planning induced restrictions on the amount of available land.
However, it appears that more proactive (regeneration) policies, designed to
improve the physical environment of particular sites, have a more profound and
positive impact on investment in both refurbishment and new construction.
Keywords: Building investment, industrial property, planning, regeneration
Paper Number:270 MENARES
MNR5
ERES 2015 Conference 24-27 June 2015 Istanbul 165
Evaluating Mega Urban Regeneration Projects:
Developing a New Model
Reyhaneh Rahimzad, Royal Agricultural University, UK
Ali Parsa, Royal Agricultural University, UK
Simon Huston, Royal Agricultural University, UK
In 21st century, with the rapid global urbanization, cities are undergoing dramatic
expansion and regeneration. Urban migration, driven by jobs and other
opportunities for wealth generation and economic development, has created the
phenomenon of ’megacities’. Mega Urban Regeneration Projects (MURP) and
emblematic projects were once urban policy solution. However in practice,
MURPs, due to their complexity, scale and risk, were often over-budget or late
(Flyvbjerg et al, 2003: Altshule and Luberoff 2003).
Issue: Besides the risk of waste and high opportunity costs, the other criticism
levelled against MURP is their proclivity to concentrate spatially on privileged
enclaves or capital cities. Arguably, London has had too many construction
projects whilst regional UK is neglected but is this a sustainable development
model?
This paper draws upon case studies in the UK. It first develops a MURP screening
framework and then uses it to critically evaluate London’s large urban
regeneration developments. This study will contribute to academic discourse and
produce practical implications for the policy makers, planners, investors,
developers and other key stake holders who are involved with Mega Urban
Regeneration developments, to reinforce positive trends and enable policies to
avoid mistakes. The methodology involves an extensive literature review,
secondary data analysis and profiling a series of case studies and interviews with
key players involved with mega urban regeneration projects.
Keywords: Foresight, resilience, urban planning, institutions, sustainability
Paper Number:278 MENARES
MNR5
166 ERES 2015 Conference 24-27 June 2015 Istanbul
Financing Real Estate and Urban Regeneration in Iran
Yasser Zanjiri, Urban Paradigm, Iran
Ali Parsa, Royal Agricultural University, UK
The advancement in institutional financing in Iran has affected both the funding
and investment environment in almost all businesses including urban
development and real estate in recent years. This has provided private sector
owned businesses with new vehicles for capital raising while offering innovative
investable products to institutional and retail investors compared with other forms
of investment notably the saving accounts and share trading. In a broader context,
however, this has enabled businesses to utilise private sector capital in a larger
scale. Reviewing recent activities in the capital market particularly the funds,
provides a better understanding of both the market size and its contribution to real
estate and urban development sector. This paper will outline the latest
development of the real estate market in Iran. Furthermore, through providing an
analytical investigation of the capital market in Iran, this paper examines a variety
of mechanisms utilised for delivery of urban regeneration projects in Iran
employing different forms of public private partnerships and private sector finance
via establishment of Special Purpose Vehicles (SPVs). This is done through
utilising live case study projects in which sources of finance, fund structure and
operation models are investigated. This paper undertakes an in-depth analysis of
the financing mechanisms based upon the evidence drawn from case study
projects, identifies three different types of SPVs focusing on main sources of
finance and assesses the characteristics and effectiveness of these schemes.
Keywords: Middle east, real estate finance, real estate investment, urban
development, urban regeneration
Poli
Paper Number:279 MENARES
MNR5
ERES 2015 Conference 24-27 June 2015 Istanbul 167
Sustainability, Tall Buildings, High Density and Compact
City Development: Dubai Marina, Dubai, United Arab
Emirates
Leila Shojaei, IAU University Department of Architecture and Urban Planning, UAE
Ali Parsa, Royal Agricultural University UK
Contemporary urban development in the United Arab Emirates has been based
on the creation of spectacular skyscrapers. Dubai has a large concentration of tall
buildings amongst them the world’s tallest tower, Burj Khalifa. The development
of high-rise buildings in Dubai (residential, commercial or mixed-use) is defining
the city with structures competing with each other in design and height. These
towers provide a high ratio of space where more people can live, especially when
the land is in limited supply with rapid population growth. Tall buildings may be
sustainable in terms of saving land, but constant ground level interaction can
impact environmental and social components. They also provide great views, gulf
water front, man-made lakes augmenting real estate values and neighboring
areas to capitalise on their prospects too.
The development of Dubai Marina district has been based on formation of the
man-made Marina from rerouting the water from the Persian Gulf to create a new
compact waterfront with high-rise buildings. This paper will address two key
questions concerning social and environmental sustainability criteria. Firstly, what
are the characteristics of high-rise, high-density compact urban form? And
secondly, how high rise, high-density compact cities could address the social and
environmental sustainability in Dubai Marina?
The methodology is based on a mixed method approach involving both qualitative
and quantitative (Statistical Analysis and SPSS software) of case study of Dubai
Marina.
Keywords: Compact city, real estate values, tall buildings, urban development,
waterfront development
Paper Number:48 MENARES
MNR5
168 ERES 2015 Conference 24-27 June 2015 Istanbul
Housing Market Annual Gross Yield Modelling: A
Comparison between two Dynamic Markets (Istanbul and
Dubai)
Ali Hepşen, Istanbul University, Turkey
Olgun Aydın, Mimar Sinan University, Institute of Science, Department of Statistics,
Turkey
Orhan Vatandaş, REIDIN Lead Data Analyst, Turkey
The main purpose of this study is to investigate whether there is a long-run
relationship between macroeconomic indicators and residential returns for two
dynamic markets (Istanbul and Dubai). This paper uses the monthly residential
return data for the twelve year period from January 2003 to December 2014
provided by REIDIN. In order to identify long term equilibrium between residential
returns and macroeconomic indicators, correlation analysis, impulse response
analysis and kriging metamodelling are utilized for the study. The findings of this
paper would help government and property investors for creating more effective
property management strategies in these markets.
Keywords: Correlation analysis, impulse response analysis, kriging
metamodelling, macroeconomic indicators, residential returns
Paper Number:293 Real Estate Education
N-6
ERES 2015 Conference 24-27 June 2015 Istanbul 169
Multi-disciplinary Real Estate Education: A Comparison of
a US and European Approach
Margaret McFarland, University of Maryland, USA
Hossein Lavasani, University of Maryland, USA
Real Estate education in the US at the graduate level has has a "bumpy" time in
US academic institutions. Up until the year 2000 or so, most real estate was
taught, if at all, in business schools as a finance/valuation proposition. There was
little or no bow to the Graaskamp model of multi- and inter-disciplinary curriculum
in recognition of the diverse disciplines that impact real estate and hence the need
for a curriculum to match. In 2006 when the University of Maryland established
it's Master of Real Estate Development [MRED] program it embraced the multi-
disciplinary approach, and was the 7th program in the US based outside of a
Business School, offering a more extensive (and broader based) education for
real estate professionals. There are now more than 20 such programs in the US
as well as multiple programs across Europe. Each program is quite unique and
can be compared for differences in curriculum, pedagogy, delivery method
(executive, on line, face to face), student background preparation, emphasis on
professional skills development, as well as type of faculty (research, clinical,
professional) and desired outcomes/positions for students. This paper compares
two programs with similar objectives but very different delivery methods -- one in
the US (Maryland) the other in Bucharest, Romania. The Maryland program is now
9 years old and has evolved with a parallel emphasis on financial competency as
well as professional skills development. The Advanced Studies in Urbanism and
Real Estate Development (ASURED) established in 2014 is affiliated with the "Ion
Mincu" University of Architecture and Urban Planning and is accredited by RICS.
This paper will address what are the common, as well as dissimilar, elements of
each program and provide a further basis for consideration of educational
standard setting in real estate education, both in US and Europe.
Keywords: Curriculum, diversity, pedagogy, professional skills, multi-disciplinary
Paper Number:128 Real Estate Education
N-6
170 ERES 2015 Conference 24-27 June 2015 Istanbul
Industry Expectation of Australian Property Higher
Education Programs
Kathryn Robson, School of Property, Construction & Project Management RMIT
University, Australia
Guillermo Aranda- Mena, School of Property, Construction & Project Management
RMIT University, Australia
James Baxter, School of Property, Construction & Project Management RMIT University,
Australia
Purpose: Property education is predominantly taught at undergraduate level,
supported by post-graduate programs at many Australian universities. This paper
examines undergraduate property programs from the perspective of one of the
major stakeholders; the property industry. The current offerings have evolved from
highly applied practical valuation-centric programs in the 1970s to broader, more
academic programs in the current era. This change has created different
expectations for both students and industry. Methodology: Initially a focus group
of six property industry employers was held and their discussion is included in the
paper and informed the development of a questionnaire using the online delivery
vehicle Qualtrics. This questionnaire was emailed to 460 industry leaders, as listed
on company websites and university Employer of Choice databases. 95 people
responded to the questionnaire.
Findings: After surveying students, recent graduates and industry leaders, it
appears as if there is a gap between what the universities claim about their
graduates and what many employers of property graduates find. Despite the best
efforts of the universities and their staff, despite robust and rich curricula, it would
appear that evidence from industry and the Australian Property Institute who
register practitioners, is that most graduates require specialist training and
additional study before they can be considered work ready.
Value: This paper offers valuable insights with regard to how higher education
property programs are regarded by the property industry in Australia.
Keywords: Industry expectations, accreditation, real estate education, work
experience, work ready graduates
Paper Number:162 Real Estate Education
N-6
ERES 2015 Conference 24-27 June 2015 Istanbul 171
Creating Future-Proof Learning Environments - A Study on
Educational Objectives and Conceptual Decision-Making
Pieter Le Roux, NHTV Breda University of Applied Sciences, The Netherlands
Changes in the demographical composition of student numbers, their educational
expectations and advances in didactic formats require that educational
institutions review the link between their physical learning environments and their
educational visions. In general, educational visions respond to “changing social
demands and technological developments, innovations in the industry, new
insights within knowledge domains, and last but not least, results from
educational research” (NHTV, 2014). The purpose of the current on-going study
is to research changes and developments in educational goals and objectives (in
response to the educational vision), and rank conceptual decision-making on
creating responsive and future-proof learning environments in order of relevance
and applicability to the specific educational vision in question.
The current research design applies multiple methodological approaches. Part of
this approach consists of a similar methodology as was discussed in earlier
research on the application value of a process model for supporting decision-
making in property and real estate management education (Le Roux, 2014) as
was presented and the 2014 ERES conference in Bucharest, Romania. As such,
this process model for supporting decision-making on organisational
accommodation is applied as a central structuring element in determining
educational objectives for / with new learning environments. In addition to the
application of this process-model for supporting decision-making, literature on
quality function development is applied to assist in the ranking of conceptual
choices for elaborating and implementing solutions for future-proofing learning
environments.
The originality and value of the current research lies in the combination of multiple
research methodologies in facilitating evidence-based decision-making on future-
proof strategies and approaches to creating more responsive learning
environments. This is particularly true in terms of the application of the theoretical
knowledge associated with quality function deployment (QFD) in learning
environments.
Keywords: Decision-making, educational vision, learning environment, quality
function deployment, responsive
Paper Number:252 Real Estate Education
N-6
172 ERES 2015 Conference 24-27 June 2015 Istanbul
Ethics in Real Estate Firms in India
Anil Kashyap, RICS School of Built Environment, Amity University, India
Saumya Shirina, RICS School of Built Environment, Amity University, India
The real estate sector has been the backbone of the Indian economy and has
been a major contributor in the economic growth. The real estate developers have
been instrumental in changing the face of India from being an under-developed
country towards accelerating its way to a developed country. Real estate
transactions are not only getting larger in numbers in India but also involve
increasingly large sums of money. The real estate market has been known for its
lack of transparency in the past, but the trend is changing rapidly. The larger
property consultancies are handling a number of international clients now – clients
who are eager to enter or expand operations on the Indian subcontinent. Such
clients have high standards in terms of service quality and clarity, and are often
justifiably worried about being taken for a ride by unscrupulous operators. They
initially have to depend on is the tangible, verifiable ethical approach of their real
estate partners on this end. The facets of ethical business conduct in India pertain
to clients, others to employee conduct and yet others to government authorities.
Sets out to examine the expectations of ethics in real estate firms in India. It
surveys real estate agents and their clients on their expectations of ethics in
property transactions. Draws conclusions pertaining to ethical expectations from
the results of this field work. This paper aims to focus on the importance of rules
of conduct and professional ethics from the perspective of RICS (Royal Institute
of Chartered Surveyors) code of ethics.
Keywords: Real estate, business conduct, business conduct, ethical practices,
real estate firms
PoliPaper Number:61 Real Estate Education
N-8
ERES 2015 Conference 24-27 June 2015 Istanbul 173
Future Direction of Real Estate Education for the
Certificate Programs at National Institute of Valuation
(INSPEN)
Mohd Haris Yop, National Institute of Valuation (INSPEN),University of Malaya, Malaysia
Real estate education is a unique program specifically develops to educate and
equip students with strong knowledge and principle of Real Estate that lead to
and sustain a productive Real Estate based career in future. The direction of real
estate education necessitates an important emphasis on the managerial,
empirical and decision-making aspects of the respective industry. INSPEN is
established with a function to execute educational programs with a particular
emphasis on the needs and wants of the aforesaid industry. The vision of INSPEN
is to realize a high quality form of education and diversification of skills in career
in real estate through basic real estate education at the aforementioned
establishment. Therefore, the study to aim the relevancy of existing subjects in
meeting the current and future direction of real estate education provided by
INSPEN certificate programs and to fill a lack or gap on generic skills and
knowledge outcome from industrial perspective and students’ experiences. The
results indicate that Real Estate Valuation was the most important subject from
the participating graduates and industry professionals respectively and the
following the subject was Industrial Training. Technical knowledge recorded a
somewhat higher score with an advantage. On the other hand, a small difference
of score was recorded for skills such as Mathematical competence, English
fluency and writing eloquence. Four generic skills were in line with the future
educational direction proposed by INSPEN for its certificate programs. There was
also a suggestion that INSPEN should offer courses beyond the certificate level
in partnership with universities and conduct part-time courses for working and
non- working executives who are already in the real estate industry.
Keywords: Generic skills, industrial perspective, knowledge, real estate
education, students experiences
Paper Number:72 Real Estate Education
N-8
174 ERES 2015 Conference 24-27 June 2015 Istanbul
Blended Learning in Real Estate Education: A Survey
Bob Thomson, Remit Consulting LLP, UK
Bob Martens, Vienna University of Technology, Austria
Blended learning is to regarded a didactical meaningful combination of traditional
face-to-face instruction and state-of-the-art e-learning formats. The efficiency and
flexibility of computer-mediated forms of learning are combined with the social
aspects of face-to-face communication. In other words a useful learning
arrangement which combines modern-day means of networking through the
internet and ‘classical’ learning methods and media.
At the time of writing, blended learning has been operational for some fifteen
years. Normally this would be long enough for optimal models to have evolved
and regimes to be established to measure the effectiveness of the techniques
employed. However, blended learning involves the use of technology – at least in
part – and fifteen years is a long time in technology terms.
Early online learning developed as an asynchronous process – especially outside
the traditional University environment. As a student-centred teaching method it
uses different resources to facilitate information sharing among a network of
people. It is not constrained by time or place but was constrained by technology,
particularly low bandwidth that restricted the complexity of course material and
effectively prevented the construction of synchronous interaction. More recently,
with the effective removal of bandwidth constraints, synchronous online learning
has been developed as a way of addressing the issues of transactional distance
experienced with asynchronous learning.
It must be noted that real estate education is not at all unified. Major differences
may exist concerning (blended) learning. In order to verify this assumption, a
survey about the use of blended learning in real estate education has been
conducted. Survey results have been triangulated with a number of in-depth
interviews with course directors and leaders. In addition case studies of blended
learning practice are presented to add context to the study.
Keywords: Computer mediation, content management system (CMS), learning
models, teaching METHODS, virtual learning environment (VLE)
Paper Number:349 Real Estate Education
N-8
ERES 2015 Conference 24-27 June 2015 Istanbul 175
What Do Students Need To Know About Property? What
Do Textbooks Actually Teach About Property?
Stephen Roulac, Roulac Global, USA
To function effectively in multiple roles and priorities concerning property students
need to know property knowledge that they would not know prior and sadly, all
too prevalently, after to an introductory real estate principles course. These roles
subsume responsible citizen, consumer of property goods and services,
choosing place in which to live, selecting and arranging the terms of a particular
property interest, property in business, development and the place making
process, property financing and investing, and the various functions of property
and the careers associated with those property functions. This big scope, big
scale, big tent knowledge prescription implies an audience for property education
extending well beyond those who might work in the property discipline per se.
Introductory property textbooks, however, are predominantly oriented to those
who would pursue property careers.
The design of a property curriculum necessarily follows from consideration of the
scope and particulars of the property discipline as widely recognized and
practiced. If the property discipline is considered narrowly, as it most often is, then
the needed knowledge may be very different than if the property discipline is
considered more broadly, as it too seldom is. Consider the differences in how
need to know property knowledge might be defined from such contrasting
perspectives as:
• Sell side or buy side
• Business level or individual consumer level
• Private property or public good
• Property owner or tenant
• Property provider or property user
The property discipline is most be effectively considered from dualistic
perspectives, a portfolio of yin and yang contrasts. Just as property practitioner
and professionals education must reconcile the challenge of balancing
established institutions and new models, tradition and innovation, continuity and
discontinuity, so, too, must the articulation and instruction of property knowledge
reconcile these competing objectives. This task is made even more fraught by
the extraordinary change in so very many elements of the property discipline.
This paper builds on an empirical content analysis of real estate textbooks in
relationship to their relative emphasis on major categories of knowledge, to
consider the degree to which these textbooks cover the major perspectives that
may be favored for property knowledge. A structure to organize property discipline
knowledge into 15 property knowledge domains is provided
Keywords: Education, academics, real estate
Paper Number:225 Real Estate Education
N-8
176 ERES 2015 Conference 24-27 June 2015 Istanbul
Integration of Internationally Orientated Content into Real
Estate Education Programmes - Exemplified by the
Degree Programmes at Nüertingen-Geislingen University
Gisela Vogt, Nüertingen-Geislingen University, Germany
Dieter Rebitzer, Nüertingen-Geislingen University, Germany
The integration of internationally orientated content modules in English language
into the curriculum of real estate education programmes is frequently required by
accreditation agencies and university management, also however by the job
market and employers. One of the challenges in the process is to provide the
language skills required and to tailor the internationally orientated content
modules in such a way that they represent an integrated part of undergraduate
and graduate programmes. The first part of the following paper presents an
example of how students with largely varying levels of English language skills at
entry level enhance their language proficiency skills and are introduced to the
most relevant technical real estate terms in order to meet the needs of the job
market and to complete internationally orientated content modules in English
language successfully. In the second part of the paper examples will be given of
successful integrations of internationally orientated content modules in English
language within the Bachelor and Master programmes of Nuertingen-Geislingen
University.
Keywords: Internationalisation, real estate education
Paper Number:9 Real Estate Finance&Investment
O-1
ERES 2015 Conference 24-27 June 2015 Istanbul 177
The Performance and Diversification Benefits of European
Non-listed Real Estate Funds
Graeme Newell, Property Investment School of Business University of Western Sydney,
Australia
Non-listed real estate funds are an important real estate investment product in the
European real estate landscape. These non-listed real estate funds provide
investors (eg: pension funds, sovereign wealth funds) with exposure to high
quality real estate portfolios in the European region.
Using the INREV non-listed real estate fund index, the risk-adjusted performance
and diversification benefits of European non-listed real estate over 2010-2014 is
assessed. This is further assessed for European non-listed real estate fund
performance by style (core, value-add), country, region, sector (single sector,
multi-sector) and structure (closed end, open end). This paper provides important
insights into the benefits of European non-listed real estate in a portfolio.
Keywords: Diversification benefits, Europe, non-listed real estate funds, risk-
adjusted performance, sub-sectors
Paper Number:55 Real Estate Finance&Investment
O-1
178 ERES 2015 Conference 24-27 June 2015 Istanbul
Evaluating Financial Health of Real Estate & Construction
Industry in India
Chetna Batra, School of Built Environment, Noida, India
Real Estate & Construction sector plays an important role in the development of
a country’s base. Understanding its performance would be crucial as, in India, it
is one of the largest contributors to the Gross Domestic Product (GDP) and one
of the largest generators of economic activity. Real estate & construction sector
in general, is perceived to be financially more risky compared to other sectors of
the economy. The current research extends and adds to the extant literature by
investigating the financial health of Real Estate & construction firms in India.
Financial ratio analysis which is one of the most widely used tools for financial
performance evaluation is used for this study. The following major categories of
ratios have been used for the analysis-Efficiency, Profitability, Solvency and
Liquidity. The time period for the study is 2009-2014. Publicly listed Indian real
estate & construction companies which are engaged in the development of retail,
commercial, residential and civil services are examined. A sample of 20 real estate
& construction companies listed on Bombay Stock Exchange (BSE) and National
Stock Exchange (NSE) was selected for this empirical research. All of the selected
sample Indian real estate & construction firms have a market capitalization of
more than Rs. 100 crores. The research study relies on secondary data based on
firms’ annual reports and financial statements. The research provides important
insights into the financial performance of real estate & construction firms in India
and the findings are encouraging for the growing real estate & construction sector.
The findings will be useful for investors and government policy makers.
Keywords: Construction, financial analysis, India, ratios, real estate
Paper Number:139 Real Estate Finance&Investment
O-1
ERES 2015 Conference 24-27 June 2015 Istanbul 179
Mortgage Financing and the Performance of Real Estate
Business in Uganda; Lessons a From a Developing
Country Context
Rachael Daisy Mirembe, Makerere University Business School Department of
Finance, Uganda
Isaac Nabeta Nkote, Makerere University Business School Department of Finance,
Uganda
Augustine Matovu, Makerere University Business School Department of Finance,
Uganda
The study was prompted by increased development of real estate in Uganda
particularly Kampala. The purpose of this study was therefore to establish the
relationship mortgage financing and performance of real estate in Uganda. To
achieve the above purpose, a cross-sectional research design together with the
quantitative research design was used in the survey. The survey population
included Mortgage Beneficiaries and Real Estate Firms in Kampala District. Snow
ball sampling method was used to select samples used in the study. Self
administered questionnaires were used to collect data from Mortgage
Beneficiaries and Real Estate Firms. Data was collected from 297 respondents
with a response rate of 84%. Data was analyzed using (Statistical Package for
Social Scientist) SPSS.Pearson’s rank correlation coefficient was used to measure
the strength of the relationship between variables and a regression analysis was
used to determine the extent to which the dependant variable could predict a
change in the independent variable The findings indicated that Mortgage
Financing and Performance of Real Estates are significantly correlated. From this
study, it is recommendable that in a quest to improve real estate performance,
other factors like; Political stability, training for employees in mortgage banks and
promptness in the authorization and appraisal process of mortgage loans should
be given attention.
Keywords: Mortgage finance, real estate, agency-brokerage, rental income,
return, risk
Paper Number:204 Real Estate Finance&Investment
O-1
180 ERES 2015 Conference 24-27 June 2015 Istanbul
CAPM versus Expert Opinion: Do Practitioners’
Perceptions Meet Theory? Evidence from the Survey of
Estonian Commercial Real Estate Market
Kaia Kask, University of Tartu, Estonia
Priit Sander, University of Tartu, Estonia
Kantšukov Mark, University of Tartu, Estonia
According to finance theory, several methods (either direct or indirect) can be
used to calculate investor’s required rate of return. In case of direct method, the
value of required rate of return will be given by investors themselves, which
depend heavily on investors’ levels of risk aversion. In case of indirect methods,
the required rate of return is calculated using current or historic data. The major
difficulty here is that actual required rate of return cannot be observed from market
data and that is why scholars have to estimate different rates of return, using
various techniques. One of the most well-known and widely used methods in
theory and also in practice for estimating required rate of return of an investment
is capital asset pricing model (CAPM).
Although widely used, CAPM has still got a quite heavy criticism by several.
Therefore, the authors of the paper have an intention to test the correctness of the
estimation of long-term rates of return, calculated by CAPM on real estate market
experts in Estonia. Real estate market has chosen as the test-market sector
because of its explicit framework. Estonia as a test-country has been chosen
because of the secondary intention to prove the applicability of CAPM also on
smaller markets. The aim of the authors of the paper is to compare coherence
between the expert opinion and the theoretical calculation of the most appropriate
long-term rates of return for commercial real estate projects on the example of
Estonian real estate market. Knowingly to the authors, there has been not done
similar kind of survey so far, implying to the possible gap in the literature.
The survey findings show that the results acquired through the questionnaire
conducted among real estate appraisers, investors and consultants in Estonia
verify the correctness of the result of required rate of return obtained by CAPM,
based on long-term historic data. Based on both results, the average long-term
required rate of return of a typical market participant, considering typical
commercial real estate in Estonia, is rounded to 9%.
Keywords: Capital asset pricing model, commercial real estate market, market
expert opinion, real estate investment, required rate of return
Paper Number:94 Real Estate Finance&Investment
O-2
ERES 2015 Conference 24-27 June 2015 Istanbul 181
UK REITs Don't Like Mondays
Arvydas Jadevicius, School of Real Estate and Land Management, Royal Agricultural
University, UK
Stephen Lee, Cass Business School, City University London, UK
The research examines whether REITs returns on the different days of the week
differ from each other. It uses EPRA/NAREIT UK Index daily closing values (GBP)
and its two sub-indices FTSE EPRA/NAREIT UK REITs and Non-REITs as
dependent variables. It employs Kruskal-Wallis (KW) tests and dummy-variable
regression to test the hypothesis. In addition to that, the study introduces
dummies for outliers to control for observations that are distant from other data-
points. The overall findings provide evidence that return anomalies exist in the UK
REITs. Investors can therefore gain superior returns in UK REITs by recognising
the day-of-the-week effect.
Keywords: Anomaly, calendar, REITs, returns, UK
Paper Number:110 Real Estate Finance&Investment
O-2
182 ERES 2015 Conference 24-27 June 2015 Istanbul
Herding in the UK Real Estate Market
Stephen Lee, Cass Business School, City University, UK
Previous studies of “herding” are largely concentrated in the stock market and
have shown contradictory results depending to a great extent on the adopted
estimation model. It is important therefore to examine herding behaviour in
different asset markets using a number of models. This study therefore
contributes to the literature on “herding” by studying the propensity for investors
in the UK private real estate market to exhibit herding behaviour using monthly
data over the period 1987-2014 using a number of model specifications.
Keywords: Herd behaviour models, UK private real estate data
Paper Number:137 Real Estate Finance&Investment
O-2
ERES 2015 Conference 24-27 June 2015 Istanbul 183
Idiosyncratic Risk in Direct Property - A Review of the
Literature
David Parker, University of South Australia, Australia
Idiosyncratic risk in listed property securities has been widely investigated and
reported in the literature. Less attention has been paid to idiosyncratic risk in direct
property. This paper seeks to review the current state of the literature concerning
idiosyncratic risk in direct property and identify opportunities for further research.
Keywords: Direct, idiosyncratic, property, risk, specific
Paper Number:163 Real Estate Finance&Investment
O-2
184 ERES 2015 Conference 24-27 June 2015 Istanbul
European REITs NAV Discount: Market Sentiment and
Fundamental Factors
Giacomo Morri, SDA, Bocconi School of Management, Italy
Alessandro Baccarin, Bocconi University, Italy
This paper analyzes the NAV discount of European REITs listed in France, in the
Netherlands and in the United Kingdom between 2003 and 2014 considering both
the “rational” and the “noise trader” approaches. The analysis examines the
hypothesis that discounts (premiums) are the result of leverage, size, liquidity,
risk, performance, investment activity and sentiment. The results on traditional
NAV discount are compared with those obtained using an unlevered NAV
discount formula introduced by Morri, et al. (2005) that cleans for the bias
generated by the level of gearing. Among the main conclusions emerge that REITs
in different markets have different behavior. Moreover, the relationship that
leverage has with the traditional NAV discount is positive for England and France
based REITs, while it is negative for the Netherlands based REITs. When the
discount is adjusted to remove the bias due to the level of debt, the relationship
between leverage and unlevered discount became less pronounced in all cases.
Higher liquidity commands lower discounts for French REITs, while Dutch and
British REITs, which trade in markets that are characterized by a higher number of
average daily transactions, do not seem to suffer discounts (premiums) derived
from liquidity. Operational risk and performance are for all the three samples
significant to explain the NAV discount, the first having a positive relationship with
the discount, and the second having a negative relationship with it. Later a new
formula that adjusts the NAV discount for the investor sentiment is introduced with
the aim of identifying better firm specific factors that contribute to the discount in
order to clean possible distortions induced by sentiment. Sentiment, when
measured using the average sector discount, deeply affects the discount,
accounting alone for 10% to 15% of the explicative power of the model
considered. The results confirm the findings obtained using non-sentiment
adjusted regressions, even if reaching a lower level of R-squared. Changes of
behavior between growth periods and during crises are also investigated. A
further analysis of the NAV discount in phases of upswing and downturn allows to
say that, while fundamental factors are more relevant and stable when the market
is growing, price fluctuations during periods of recession are heavily influenced
by market sentiment, and fundamentals do not describe the dynamics of the NAV
discount in a satisfactory way.
Keywords: NAV discount, REITs, closed-end fund puzzle, leverage, noise traders
Paper Number:299 Real Estate Finance&Investment
O-3
ERES 2015 Conference 24-27 June 2015 Istanbul 185
The Impact of Tenant Diversification on Spreads and
Default Rates for Mortgages on Retail Properties
Brent Ambrose, The Pennsylvania State University, USA
Michael Shafer, Providence College, USA
Yıldıray Yildırım, Syracuse University, USA
We use an empirical model of commercial mortgage spreads to examine how
tenant diversification impacts credit spreads for mortgages on retail properties.
We find that mortgages on properties with a highly diversified tenant base have
spreads that are up to 8.5 basis points higher than spreads on mortgages for
single-tenant properties, but that mortgages on properties with moderate levels of
tenant diversification have spreads that are up to 5.5 basis points lower than
mortgages on single-tenant properties. The spread discount for mortgages on
properties with moderate levels of tenant diversification disappears when the
lease of the property’s largest tenant expires before the loan matures. Despite the
spread discount that is given to properties with moderate levels of tenant
diversification, we find that the likelihood with which a mortgage goes into default
increases as tenant diversification increases.
Keywords: CMBS, mortgage spreads, tenant diversification
Paper Number:105 Real Estate Finance&Investment
O-3
186 ERES 2015 Conference 24-27 June 2015 Istanbul
Behavioural Biases among Real Estate Investment
Decision Makers. Has Anyone Seen My Neo-cortex? I’m
Sure I Left It Here Somewhere.
Stephen Ryan, Mercer, Ireland
Matthew Richardson, Fidelity Worldwide Investment, UK
Purpose – To examine whether investors in commercial real estate exhibit some
important behavioural biases, namely: anchoring, herding, framing/nudging, loss
aversion and over-confidence. If so, are there steps that investors and their agents
(fund managers and advisors) could take (a) to temper the effects of their own
biases and (b) to exploit the presence of such biases in other market participants?
Design/methodology/approach – Analysis of historic data sources at asset and
market levels and over different time periods, with focus on identifying the specific
biases listed above, singly and in combination
Findings – Understanding of behavioural bias merits greater attention.
Research limitations/implications – Reliance on inferences from historic data
Practical implications – May help develop clearer understanding of market drivers
and improved decision-making for market participants.
Originality/value – New research within the real estate industry that could help
investors understand the highly cyclical nature of commercial real estate
investment markets
Keywords: Behavioural biases, anchoring, herding, framing, loss aversion, over-
confidence
Paper Number:215 Real Estate Finance&Investment
O-3
ERES 2015 Conference 24-27 June 2015 Istanbul 187
Decisions, Decision-making, and Decision Support
Systems in Real Estate Investment Management
Patrick Krieger, ImmIT – Nurtingen-Geislingen University, Germany
Carsten Lausberg, Campus of Real Estate Nurtingen-Geislingen University, Germany
Purpose – To date there is no such thing as a real estate decision theory. If we
want to understand real estate-related decisions we have to resort to general
decision theories and adapt them to this asset class. In our paper we do so for
real estate investments. More specifically we examine the characteristics of letting
and other investment decisions, their integration in the decision-making process,
and the technical means available to support the decision-makers. As a
theoretical basis we use dynamic decision theory which is not as restrictive as
other decision theories and better corresponds to the time-dependent and
interdependent nature of many investment decisions. Based on our analysis and
a case study we develop a set of forward-looking indicators for real estate
investment decisions and a concept for a scoring-type decision support system.
Design / methodology / approach – At first we present an overview of the literature,
covering sources from psychology, informatics, and real estate. Afterwards we
employ a case study to demonstrate that dynamic decision theory better
corresponds to reality than classical decision theory. Based on these findings we
describe our view of real estate decision-making and set up criteria for decision
support systems in real estate investment.
Findings – The literature review revealed that there are a lot of findings in the
distinct research disciplines that have never been applied to real estate.
Furthermore we found that interdependencies and feedback processes are
typical for real estate investment decisions. Hence, dynamic decision theory
seems much more applicable to develop suitable indicators and factors for a
decision support system.
Research limitations / implications – More research is needed to validate the
dynamics in cash flow pattern and to form a complete decision support system.
Originality – The paper provides a new viewpoint on decision-making in real estate
investment and qualitative factors of decision support systems in this area.
Keywords: Behavioural finance, complexity, decision support systems, dynamic
decision-making, key indicator
Paper Number:243 Real Estate Finance&Investment
O-3
188 ERES 2015 Conference 24-27 June 2015 Istanbul
Explaining the Discount in Closed Open-Ended Real
Estate Funds in Germany
Sebastian Schnejdar, University of Regensburg, Germany
Michael Heinrich, University of Regensburg, Germany
In succession of the financial crisis various German open-ended real estate funds
were closed and are now forced to fully liquidate their assets. Since Germany has
an underdeveloped REIT market compared to most Anglo-Saxon countries, this
has severe consequences for the efficiency of the capital allocation towards real
estate. The paper therefore investigates to what extent the closing of these open-
ended real estate funds were caused by their own economic situation (captured
by e.g. liquidity ratio, asset structure). In detail, the paper analyses the upcoming
discount in closed German open-ended funds. The discount is defined as the
difference between the Net Asset Value and the aftermarket share price of the
fund. The panel dataset contains unique monthly data for 9 finally closed open-
ended real estate funds in Germany from 2008 to 2014. One first result indicates
that fundamental economic operating numbers of the specific open-ended real
estate funds can`t fully explain their discount. Therefore the Closed-End Fund
Puzzle theory may be up to an adjustment in the context of open-ended real estate
funds in order to identify suitable variables for irrational and herd behavior in
explaining the discount on the macro-level.
Keywords: Germany, NAV discount, closed fund, herd behavior, open-ended
fund
Paper Number:8 Real Estate Finance&Investment
O-4
ERES 2015 Conference 24-27 June 2015 Istanbul 189
The Changing Real Estate Market Transparency in the
European Real Estate Markets
Graeme Newell, Property Investment School of Business University of Western Sydney,
Australia
A key ingredient for increased investor confidence in the European real estate
markets has been the improved real estate market transparency in the European
markets in recent years. Using the JLL global real estate transparency index,
countries are classified as high transparency, transparent, semi-transparent, low
transparency and opaque.
This paper assesses changes in the real estate transparency for 33 European real
estate markets over 2001-2014. This is also assessed in a regional and global real
estate market context. Differences in real estate transparency between the
developed and emerging European markets are also highlighted.
Keywords: Developed markets, emerging markets, Europe, JLL, real estate
market transparency
Paper Number:69 Real Estate Finance&Investment
O-4
190 ERES 2015 Conference 24-27 June 2015 Istanbul
Volatility Transmission: A Global Tri-Variate Analysis of
Public Real Estate and Foreign Exchange Markets
Simon Stevenson, University of Reading, UK
A large number of papers have examined various aspects concerning the volatility
of the public real estate sector. Whilst this literature initially tended to concentrate
on the volatility dynamics of single-domestic markets (e.g. Stevenson, 2002;
Cotter & Stevenson, 2006, 2008; Liow, 2009; Liow & Ibrahim, 2010) it has
increasingly examined the international issues. This strand of research is also tied
in with those papers to have considered spillovers and contagion affects in returns
(Michayluk et al., 2006; Liow et al., 2011; Hoesli & Reka 2011; Yang et al., 2012;
Zhou 2011). Two recent papers (Liow, 2012, Stevenson, 2013), in turn extend this
literature to consider the drivers of integration across international securitised real
estate markets. This study further extends the above cited pieces of research to
more fully account for the impact of exchange rates. It analyses the volatility
transmission between the public real estate and foreign exchange markets. This
is undertaken using a trivariate specification of the Baba, Engle, Kraft and Kroner-
generalised autoregressive conditional heteroscedasticity (BEKK-GARCH)
model. The analysis extends from 1990 through 2014 and the results highlight the
importance of factoring in fully the currency markets into any analysis of
international investment.
Keywords: Contagion, international investment, public real estate, volatility,
volatility transmission
Paper Number:159 Real Estate Finance&Investment
O-4
ERES 2015 Conference 24-27 June 2015 Istanbul 191
The Irish Real Estate Bubble: A Behavioral Finance
Perspective
Paul Ryan, University College Dublin, Ireland
Clare Branigan, University College Dublin, Ireland
Between the mid- 1990’s and the mid- 2000’s, in a period characterized as the
Celtic Tiger, the Irish residential real estate market experienced a boom. During
the 13 years from 1994 to 2007 house prices rose in excess of 400% and then in
September 2007 they started to collapse with a sustained decline continuing for
almost six years eventually stabilising in March 2013. From peak to trough this fall
was in excess of 50% and in modern times is second only to Japan in terms of
magnitude. This series of years of steady price rises accompanied by sustained
price declines constitutes a classic speculative bubble which, when it finally burst,
had disastrous consequences not only for the housing market, but also for the
banking system and the entire Irish economy triggering eventually triggering a
bailout from the IMF, European Commission and European Central Bank. This
paper explores the role that individual’s emotions potentially played in firstly
escalating and eventually pricking this bubble. To do this we conduct a textual
analysis on official reports (including IMF and OECD reports) as well as
commentary on the real estate market as reported in the media as prices firstly
escalated and eventually declined. We also perform a textual analysis of the
official reports that were commissioned after the collapse to investigate their
analysis of the causes of the bubble. Our findings are consistent with Kindleberger
and Aliber (2011) who couch their model of market bubbles in terms of human
emotions, though the official reports into the causes of the crisis were largely silent
on emotions as a primary driver. Our results have implications for the effectiveness
of official policy responses to prevent a similar bubble emerging in the future
Keywords: Dublin, behavioural finance, bubbles, rationality
Paper Number:238 Real Estate Finance&Investment
O-4
192 ERES 2015 Conference 24-27 June 2015 Istanbul
Does Being Islamic or Shariah-compliant Affect Capital
Structure? Evidence from Real-estate Firms in the Gulf
Cooperation Council States.
Omokolade Akinsomi, The University of Witwatersrand, South Africa
Seow Eng Ong, National University of Singapore, Singapore
Muhammad Faishal, National University of Singapore, Singapore
Graeme Newell, Property Investment School of Business University of Western Sydney,
Australia
This paper examines how compliance to Shariah principles may be associated
with a firm’s capital structure choice. Shariah compliant real estate firms
measured by those listed on the Dow Jones Islamic Index and Islamic real estate
firms measured by firms with an internal Shariah board have significantly lower
leverage than general real estate firms in the Gulf Cooperation Council.
Furthermore Islamic and Shariah compliant real estate firms are different from
general real estate firms however these differences do not explain previous
findings. Firm characteristics are controlled for and a fixed effect regression is
employed, results explaining differences in leverage is significant at the 1% level
for Islamic real estate firms and inconclusive for Shariah compliant firms.
Empirical findings in this paper show that it may be over-simplistic to assert that
Shariah-compliant and Islamic real estate firms have less leverage than their
general counterparts. After controlling for firm characteristics and fixed effect on
each firm, results of lower leverage remain persistent in Islamic real estate firms.
Differences in lower leverage by Islamic real estate firms is explained by poor
access to the debt market and the unwillingness of Islamic real estate growth firms
to explore leverage as a source of capital.
Keywords: Shariah compliance, capital structure, leverage, real estate firms, gulf
cooperation council
Paper Number:62 Real Estate Finance&Investment
O-6
ERES 2015 Conference 24-27 June 2015 Istanbul 193
Establishing a Blended Global Real Estate Investment
Strategy Using Transaction Based Indices
Alex Moss, Consilia Capital, UK
Hans Vrensen, DTZ, UK
Nigel Almond, DTZ, UK
There has been significant interest over the last three years in combining listed
real estate securities with direct or unlisted real estate to provide a “blended”
investment solution, which both improves liquidity and optimises risk adjusted
returns over the cycle. Following recent work on combining a UK direct portfolio
with a global listed portfolio, we have expanded our geographic sample to Asia,
Europe, and the US.
Data we use the new series of transaction based real estate indices provided by
DTZ in Europe and Asia, but for the US we use the Moodys CPPI Index. We will
use the IPD and NCREIF valuation based indices for the UK, Europe and Asia,
respectively for listed securities we use the EPRA Global developed Index. Our
data covers the period 2002-2014
Purpose The aim of the study is to answer four questions: 1) Is the benefit to risk-
adjusted returns shown for incorporating global listed real estate securities with a
UK direct property fund also apparent if the direct property element comprises
European, Asian, and/or US assets? 2) How does the performance impact change
over the cycle? 3) Is there a benefit to using transaction rather than appraisal
based indices for the US and Europe? 4) Do the results alter materially if global
real estate securities funds data is used rather than the EPRA Index?
Keywords: Blended portfolios, global real estate, Indices, Investment strategies,
transaction based indices
Paper Number:70 Real Estate Finance&Investment
O-6
194 ERES 2015 Conference 24-27 June 2015 Istanbul
Investor Protection, Corporate Governance and Firm
Performance: Evidence from Asian Real Estate Investment
Trusts
Annisa Dian Prima, INREV, The Netherlands
Simon Stevenson, University of Reading, UK
This study aims to investigate the impact of investor protection on Asian REITs
valuation and performance. The relationship between investor protection and
corporate governance mechanisms, namely board independence, concentrated
ownership by outside blockholders and sponsors are also examined in this study.
The sample consists of 317 firm year observations from 57 REITs across Japan,
Singapore, Hong Kong and Malaysia with 10 years period between 2002 and
2012. The findings show that REIT with stronger investor protection is associated
with higher firm valuation. Investor protection, however, is found to have only a
weak positive effect on REIT performance. The results further reveal that investor
protection can be a substitute to a weak level of board independence, but not vice
versa. The results also suggest that investor protection serves as a complement
to the monitoring of outside blockholder. More importantly, there is no evidence
that REIT sponsors expropriate unitholders’ wealth when there is a weak investor
protection in place. Overall, the findings show that Asian REIT unitholders are
generally protected, with an average score of 14 out of 18. However, there is still
room for improvement to foster an investor confidence to facilitate the
development of the Asian REIT market in the future.
Keywords: Corporate governance, REITs, Asian markets
Paper Number:247 Real Estate Finance&Investment
O-6
ERES 2015 Conference 24-27 June 2015 Istanbul 195
Measurement and Drivers of Time to Transact UK
Commercial Real Estate Investments
Steven Devaney, University of Reading, UK
David Scofield, University of Aberdeen, UK
Trading commercial real estate involves a process of exchange that is costly and
which occurs over an extended and uncertain period of time. This has
consequences for the performance and risk of real estate investments as well as
the strategies that investors can adopt. Despite this, the vast majority of research
on transaction times has occurred for residential rather than commercial real
estate. We conduct a study into the time taken to transact commercial real estate
investments in the UK, using a sample of 578 transactions over the period 2004
to 2013. We measure average times to transact from both a buyer and seller
perspective and we conduct econometric analysis to explain variation in
transaction times between assets. The median time for purchase of real estate
from introduction through to completion was 104 days and the median time for
sale from marketing to completion was 135 days. However, there is considerable
variability around these medians and the results from Cox Proportional Hazard
models suggest that this is related to market state, type and quality of asset and
the type of participants involved in the transaction. Our findings shed light on the
drivers of liquidity at an individual asset level and can be used in models that try
and quantify the impact of uncertain time on market on real estate investment risk.
Keywords: Hazard models, liquidity, real estate risk, time on market, transaction
process
Paper Number:18 Real Estate Portfolio Management
P-1
196 ERES 2015 Conference 24-27 June 2015 Istanbul
A Comparative Study on REIT Returns in Istanbul Stock
Exchange by Using Single Index and Fama-French
Methods
Sevtap Kestel, Middle East Technical University (METU), Institute of Applied
Mathematics, Turkey
Yener Coşkun, Capital Markets Board of Turkey, Turkey
Bilgi Yılmaz, Middle East Technical University (METU), Institute of Applied Mathematics,
Turkey
However its popularity has been rising recently, the root of Turkish REITs industry
backs to mid-1990s. Representing the critical linkage between finance and real
estate, the industry has special importance in Turkish financial and real estate
sectors. In this study, the performance of REITs return, in Istanbul Stock Exchange
for the period 2008-2013, is analyzed by defining its determinants and comparing
the efficiency of single index and Fama-French three factor models. There are
three main contributions in this study. As the first in Turkish REITs literature, a
major contribution of the study is to show differences of the return variability on
individual stock returns based on single index and Fama- French models. From a
practical contribution perspective, this study may have wider application and
provide a tool for critical decision-making in the REITs portfolio management. The
study also provides information to the investors who are willing to get benefit from
diversification by investing in REITs. Initial outcomes suggest that REIT return may
show difference according to proposed model and macroeconomic and real
estate market related variables may have specific effects on return variability.
Keywords: Fama-French three factor model, portfolio management, REIT, risk
diversification, single index model
Paper Number:290 Real Estate Portfolio Management
P-1
ERES 2015 Conference 24-27 June 2015 Istanbul 197
The Effects of REIT Sub-Categories on Mixed-Asset
Portfolios in South Africa
Omokolade Akinsomi, The University of Witwatersrand, South Africa
Lloyd Kemp, The University of Witwatersrand, South Africa
Boitumelo Masilela, The University of Witwatersrand, South Africa
Nishaan Ansary, The University of Witwatersrand, South Africa
This research aims to determine the effect of various REIT sectors on mixed asset
portfolios in South Africa. By using quarterly data and the Markowitz Mean
Variance framework the effect of each REIT sector on a mixed asset portfolio is
determined. The REIT sectors in South Africa are limited to Diversified, Industrial
& Office, Retail and Specialty REITs.Data for this research was gathered from the
McGregor database which is linked with the Johannesburg Stock Exchange. All
of the data including the REITs stock prices, the All Share and the All Bond was
sourced from McGregor Database from January 2004 t December 2013. Results
show that there seems to be more substantial evidence that specific REIT sub-
categories can achieve lower portfolio risk than All REITs portfolio. Our findings
indicate that Diversified REITs, Industrial & Office REITs as well as Specialty REITs
are all able to achieve lower portfolio volatility than All REITs. Retail REITS seem
to be the riskiest REIT sub-category. This study is relevant for investors such as
pension funds, government sovereign funds and mutual funds who are interested
in diversifying their portfolios to include specific sector of REITs and most
importantly reducing volatility.
Keywords: REITs, real estate portfolio managment, returns, risk, South Africa
Paper Number:131 Real Estate Portfolio Management
P-1
198 ERES 2015 Conference 24-27 June 2015 Istanbul
Investment Risk in the Context of Price Changes in the
Real Estate and Capital Markets
Rafal Wolski, University of Lodz, Poland
It is believed that the residential real estate market tends to be subject to strong
price fluctuations. This is an element of risk, which directly affects investors and
not just those who are interested in speculation, but also those who cater to that
market their housing needs. Strong fluctuations in real estate values are reflected
in the many dimensions of the financial condition of the investors. Affect the
possibilities of meeting the housing needs, limits, and sometimes raises the credit
rating, raises investment risk measured with measures of volatility. Apart from the
obvious social aspect and focus on the financial aspect, the author examines how
the occurrence of price bubbles is a characteristic for the housing market. In this
context, it was decided to compare the volatility of the capital market and the
housing market in Poland. Checked the correlation between these markets and
the power of change of price indices, as well as individual assets. Applications
can help rationalize decisions regarding the allocation of capital, and not just
about the motives of speculative investors, but also to those who satisfy their
housing needs. Being able to compare, they may decide of particular direction of
investments, as well as they may choose between buying or renting an apartment.
Keywords: Capital market, housing, real estate, risk
Paper Number:21 Real Estate Portfolio Management
P-2
ERES 2015 Conference 24-27 June 2015 Istanbul 199
Pricing of IPOs: The Unique Case of Turkish REITs 21
Işıl Erol, Ozyegin University Faculty of Business, Department of Banking and Finance,
Turkey
Doğan Tırtıroğlu, Department of Business Administration Kadir Has University, Turkey
The legal foundation of the Turkish Real Estate Investment Trust (REIT) structure,
put in place in 1995, is considerably different and more complex than those
observed elsewhere and predates those in Singapore, Japan, France, and the
UK. Our paper builds on the unique legal and institutional details about Turkish
REITs, as elaborated in Erol and Tirtiroglu (2011), and studies the pricing of their
initial public offerings (IPO) between 1996 and September 2014. Turkish REITs
enjoy complete flexibility in their dividend policy while being exempted from
corporate taxes and also exhibit a legally mandated concentrated ownership
structure. Further, they have some legally allowed flexibility in the asset allocation
of their portfolios. While Turkey exhibits substantial macroeconomic uncertainty
early on, it abates quite visibly, even during the Global Financial Crisis, since mid-
2000s. We document empirically underpricing in the late 1990s and early 2000s
and then fair or overpricing in late 2000s and early 2010s. This finding differs from
those of no underpricing for REIT IPOs from the US market beyond the late 1990s.
As a control sample, we also focus on all non-REIT Turkish IPOs issued during
the same sample period and offer comparative evidence on the pricing of REIT
and non-REIT IPOs.
Keywords: IPO pricing, Turkish REITs, concentrated ownership, dividend payout
Paper Number:57 Real Estate Portfolio Management
P-2
200 ERES 2015 Conference 24-27 June 2015 Istanbul
The Pricing of Embedded Lease Contracts Options
Charles-Olivier Amédée-Manesme, Université Laval, Department of Finance,
Insurance and Real Estate, Canada
François des Rosiers, Université Laval, Department of Finance, Insurance and Real
Estate, Canada
Philippe Grégoire, Université Laval, Department of Finance, Insurance and Real Estate
Canada
In all the major asset class, implied volatility is obtained from the quotations of the
derivatives market. However, in real estate, derivatives market is almost inexistent
and volatility pricing face many difficulties. This paper proposes a methodology
to determine implied volatility of real estate market based on options embedded
in lease contracts. Leases are generally agreed for long term with possible options
to leave in favour of the tenant during the course of the lease. Tenants that have
no break-options during the life of their lease expect either to pay a lower rent or
to receive more gratuities (rent free, financial incentives...) than those with options
to leave. We built up a model that allows estimating implied volatility based on the
leasing transactions by analogy between lease options and financial options.
Keywords: Implied volatility, lease structure, risk
Paper Number:60 Real Estate Portfolio Management
P-2
ERES 2015 Conference 24-27 June 2015 Istanbul 201
Alternative Index (Smart Beta) Strategies for REIT Mutual
Funds
Alex Moss, Consilia Capital, UK
Kieran Farrelly, The Townsend Group, UK
This paper looks at the effectiveness of Alternative Index (Smart Beta) strategies
for funds concentrated in listed real estate equities. In particular, we examine not
just the impact on raw returns relative to a standard (free float market capitalisation
weighted) benchmark throughout the cycle, but in particular we look at the
subsequent level of tracking error and compromise in liquidity to determine
appropriate risk adjusted returns.
The paper use the EPRA Global Developed Index as the benchmark, and looks at
monthly data over a 20 year period (June 1994-2014) for three regions; North
America, Europe, and Asia Pacific. The periods are divided into distinct phases of
the cycle to determine the effectiveness of each strategy, in each region, at each
stage of the cycle.
The weighting strategies we use are: Equal Weighting, Fundamental (Gross
assets and NOI), Valuation (Relative Dividend Yield, and Price to Book Value),
Volatility, and Leverage
The usefulness of Alternative Indices in asset allocation has been examined in
detail for generalist equity funds, but there is little literature on the impact on sector
specific funds in general, and real estate securities funds in particular.
The results provide valuable insights into how superior risk adjusted returns can
be generated at different stages of the cycle by tilting the portfolio concentration
away from free float market capitalisation towards alternative medium term buy-
and-hold strategies, whilst minimising risk as defined by tracking error and
liquidity reduction.
Keywords: Alternative index, investment strategies, mutual funds, REITs, smart
beta
Paper Number:75 Real Estate Valuation
Q-1
202 ERES 2015 Conference 24-27 June 2015 Istanbul
Pricing to Market - Property Valuation Methods Revisited
Nick French, Department of Real Estate & Construction Oxford Brookes University, UK
Laura Gabrielli, Dipartimento di Architettura, Italy
Since the global Financial Economic Crisis (FEC) hit the world markets in
2007/2008, the role of property valuation has been under greater and greater
scrutiny. The process of valuation and its quality assurance has been addressed
by the higher prominence of the International Valuation Standards Council (IVSC).
This is a significant initiative worldwide. However, there has been little written on
the appropriate use of valuation approaches and methods in market valuations.
Since the publication of the IVSC Valuation Standards, there is now a hierarchy of
valuation definitions. These are determined by the International Valuation
Standards of the International Valuation Standards Council (IVSC, 2013). In order,
there are Valuation Approaches, Valuation Methods and, as a subset of the
methods, techniques or models. The IVSC recognises three approaches (Income,
Cost and Market) that are all based on the underlying economic principles of price
formation. The appropriate basis will vary depending on the purpose and nature
of the valuation. Each of these principal valuation approaches includes different
detailed methods of application and within these methods, there are different
models. It may seem to be unnecessarily precise and a simply a question of
semantics but it is important to have an understanding of where valuation models,
as discussed in this paper, fit within the process of valuation. The hierarchy within
the IVSC standards follows the convention noted below:
APPROACHES (IVSC Para 56) 1. Income The income approach provides an
indication of value by converting future cash flows to a single current capital value.
2. Cost The cost approach provides an indication of value using the economic
principle that a buyer will pay no more for an asset than the cost to obtain an asset
of equal utility, whether by purchase or by construction. 3. Market The market
approach provides an indication of value by comparing the subject asset with
identical or similar assets for which price information is available.
METHODS 1. Comparable Method (Market) 2. DRC/Construction Method (Cost)
3. Investment Method (Income) 4. Residual Method (Income) 5. Profits Method
(Income)
TECHNIQUES (IVSC Para 61) For example, with the Investment Method, the
valuer can choose an implicit or explicit model. e.g. Implicit Capitalisation vs.
Explicit DCF Income capitalisation (implicit), where an all-risks or overall
capitalisation rate is applied to a representative single period i
Keywords: Aluation models, market value, property valuation, valuation
approaches, valuation methods
Paper Number:127 Real Estate Valuation
Q-1
ERES 2015 Conference 24-27 June 2015 Istanbul 203
Statutory Valuation and the Use of Automated Valuation
Models
John MacFarlane, School of Computing, Engineering and Mathematics University of
Western Sydney, Australia
The requirements for statutory valuations are that they are fair and equitable so
that these characteristics also pertain to the taxes based on the valuations. It is
also preferable that statutory valuations are close to market values so that there
is a reasonable level of transparency in the valuation process and the general
public can have confidence in the statutory valuation outcomes.
It is also important that the statutory valuation process is relatively inexpensive so
that the associated taxes are reasonably efficient.
In New South Wales, annual Land Valuations are produced for approximately 2.5
million properties. A very natural question is: “What is the place for Automated
Valuation Models (AVMs) and Computer Aided Mass Appraisal (CAMA) in the
statutory valuation process?”.
The paper will examine this basic question and others which follow from it,
including:
•What is the balance between reduced cost and the consistency and accuracy of
valuations?
•What should be the complexity of the underlying model(s)?
•What are the associated data requirements for different categories of properties
(zonings)?
•To what properties can an AVM be applied and where should other valuation
methods be used?
Examples from the NSW land valuation process will be considered.
Keywords: Mass appraisal, modelling, outliers, quality assurance
Paper Number:166 Real Estate Valuation
Q-1
204 ERES 2015 Conference 24-27 June 2015 Istanbul
Effect of Changing Valuer on Real Estate Portfolio
Valuations
Ytzen Van der Werf, University of The West of England, UK
Fred Huibers, Amsterdam School of Real Estate, The Netherlands
Institutional investors in The Netherlands experience a large shift in market value
after changing valuer on their portfolio valuations. Examples of differences up to -
30% were reported during the period of decreasing values after the GFC.
We studied a set of over 22,000 individual valuations on a 6 year period (2008-
2013) and found a significant effect of changing valuer for the office property
market of nearly -9%. Partially this effect was caused by the nature of the valuation
process (desk top versus full valuation) but most of the difference was due to the
absence of knowledge of the previous valuation. Retail and residential properties
did not exhibit a significant effect of the absence of knowledge. Furthermore when
trying to explain the reason for this difference we found that surveyors performing
a first time valuation used more recent comparable evidence to underpin their
valuations than valuers performing a repeat valuation. Average age of the used
comparable transactions in a first time valuation is 8.5 months where the average
age of comparable evidence for repeat valuations appears to be nearly 10
months.
Anchoring to existing market evidence by repeat valuers seems to be at the heart
of the problem. Changing valuer could lead to large differences in the market
value of the properties under valuation but appears to be more in line with
contemporary market evidence. Institutional investors should investigate the
comparables used by valuers performing repeat valuations more thoroughly.
Keywords: Anchoring, change valuer, property valuation
Paper Number:6 Real Estate Valuation
Q-2
ERES 2015 Conference 24-27 June 2015 Istanbul 205
Does Urban Subcentres Influence Housing Prices? An
Analysis of the Metropolitan Region of Barcelona
Carlos Marmolejo Duarte, Valuation and Land Management Research Centre (CPSV),
UPC University, Spain
Juan Camilo Echavarria Ochoa, Valuation and Land Management Research Centre
(CPSV), UPC University, Spain
In the monocentric classic model the bid rent theory suggest a trade-off between
land value and transport costs between residential location and the CBD where
all employment is likely to be concentrated. Nevertheless, contemporary
metropolises significantly apart from that stylized model for a number of reasons.
Firstly, monocentricity coexist with polynucleation and employment diffusion and,
secondly the place of work does not exerts the only, and probably, nor the main
influence on quotidian travel behaviour, since transport surveys reveals an
emergence of non-labour mobility. In this paper we test in Barcelona Metropolitan
Area, a very well recognised polycentric Mediterranean city, whether proximity to
subcentres is a key determinant of housing prices. Using listing prices a hedonic
model is built, and the asking price is regressed over the distance to different
subcenters, identified by analysing the travel and spatial behaviour of people,
among other control variables. The results suggest that subcentres does exert
little influence on housing prices and other amenities have a significant influence
on the spatial distribution of values.
Keywords: Housing prices, land value, polycentrism, urban economics
Paper Number:30 Real Estate Valuation
Q-2
206 ERES 2015 Conference 24-27 June 2015 Istanbul
Anchoring Effects in Appraisals – A Study of Swedish Real
Estate Students
Peter Palm, Malmö University, Sweden
Helena Bohman, Malmö University, Sweden
Magnus Andersson, Malmö University, Sweden
Purpose – The objective of the research is to investigate the anchor effect in
appraisal of residential property based on a quantitative survey among Swedish
students at a program for real estate brokerage. Prior research has identified
various factors that influence price perceptions, including factors that affect
assessments of the perceived value of products to consumers and, relatedly, the
reference prices consumers use to evaluate the attractiveness of given prices
(e.g., Winer 1986). Although the determinants of reservation prices have been
extensively studied, there has been much less research regarding the manner in
which consumers decide on the lowest price they are willing to accept for a
product (for exceptions, see, e.g., Carmon and Ariely 2000; Kahneman, Knetsch,
and Thaler 1990). The value appraised is individual and may depend on different
parameters such as tacit knowledge and personal taste. Tversky and Kahneman’s
(1974) seminal work on anchor effects reveal that an external number, referred to
as anchors, influence the value people will estimate a given object. Within real
estate valuation Northcraft and Neale (1987) applied the same idea on real estate,
conducting a study in which both students and real estate agents were to value
the same house while changing the conditions regarding asking price for the
house. Although the asking price should not affect the valuation of the market
value, the study concluded that both real estate agents and students were
positively affected by the asking price.
Design/methodology /approach - An experiment with students was conducted
where they were to value two different properties. The experiment tasks were
design to be both representative of real valuation situation and to be relevant for
the students in their course as a kind of rehearsal. They were not informed of the
experiment´s manipulative design nor the research objectives. A total of 53
students, all in their last semester in the real estate broker education within the
course of Real estate valuation, participated in the experiment and were divided
into group A and B. In addition one more group was included. This group C
consists of 17 participants who all are employed as assistant at broker firms and
undertaking in service-training in order to become licensed real estate brokers.
This group was included to be used as a control group since they can be
considered as semi-professionals or at least to have practical pre-knowledge.
Keywords: Appraisal, anchor effect, real estate broker, residential property
Paper Number:203 Real Estate Valuation
Q-2
ERES 2015 Conference 24-27 June 2015 Istanbul 207
Reducing the Property Appraisal Bias with Decision
Support Systems
Anja Dust, Campus of Real Estate Nurtingen-Geislingen University, Germany
Kathleen Evans, Department of Construction Economics and Management University of
Cape Town, South Africa
Carsten Lausberg, Campus of Real Estate Nurtingen-Geislingen University, Germany
Marcel Schmid,
Francois Viruly, University of Cape Town, South Africa
Any appraiser is subject to many potentially biasing influences which compromise
the accu-racy of the appraisal. One of the most prominent biases is the anchoring
heuristic: appraisers involuntarily anchor to reference points such as their previous
valuation, the value opinion of the seller, or the last transaction price. While many
studies have proven the existence and importance of the anchoring effect in real
estate appraisals, very few studies have suggested practical means to counter it
(“debiasing”). In this paper we demonstrate that the anchoring effect can be
reduced with a computer software supporting the valuers in their decision-making.
In our experiments we asked experienced valuers and novices to perform a
valuation of a commercial property, based on a set of documents and with the
help of a self-written valua-tion software. Each proband received one of three
versions of the software with different fea-tures for debiasing to test its influence
on the appraised values. The experiments were carried out in Germany and South
Africa using two variants of the income approach as the valuation method. Two of
the properties were fictitious, one was real and for sale when the experiment was
carried out. The comparison of the sub-samples adds to our understanding of
how decision support systems can reduce valuation variance.
Keywords: Anchoring heuristic, appraisal bias, debiasing, decision support
system, valuation variation
Paper Number:227 Real Estate Valuation
Q-2
208 ERES 2015 Conference 24-27 June 2015 Istanbul
Evolution of the Explanatory Variables of the Price of Real
Estate in Lisbon during the Last Economic Crisis
Paulo Castanheira, ESAI- escola Superior de Actividades Imobiliárias, Portugal
The main purpose of this study is to understand how the price of housing is
formed in the new (expo) and old town in Lisbon (traditional neighborhoods). The
study focuses on the prices of the apartments that were sold with the assistance
of Estate Agents operating in Lisbon in last 3 years, and how the economic crisis
can explain the market price. For the development of the study, we used two
different methodologies: Hedonic Pricing Methods (MPH) and Artificial Neural
Networks (ANN). ANN are a less traditional econometric technique from the field
of Artificial Intelligence, but they are strong competitors with the MPH. In the last
two decades, the MPH has been applied to the real estate market in Portugal but,
till the present, no single study is known with the ANN. To obtain the best hedonic
model, numerous tests were developed, aiming the validation of MPH and also
the adequate selection of variables that contribute most to the prices. The tests
were performed with the statistical software SPSS, The explanatory variables
included in the final model for the price of an apartment were: the floor area (m2),
the garage and basement index, the comfort index, the location index and two
other variables resulting of interactions, one between the year of sale and the
condition of the apartment (whether it is new or used) and the other between the
preservation index and the condition of the apartment. With these six explanatory
variables, the MPH has achieved an accuracy quite significant when compared
with some previous studies.
Keywords: Artificial neural networks, hedonic prices
Paper Number:268 Real Estate Valuation
Q-3
ERES 2015 Conference 24-27 June 2015 Istanbul 209
Value of the Energy Performance Certificates in the
Housing Market – What is the Weight as Evidence of Open
Data?
Ari Laitala, Aalto University, Finland
Juhana Hiironen, Aalto University, Finland
Mikael Postila, Orava Funds, Finland
Kauko Viitanen, Aalto University, School of Engineering, Department of Real Estate,
Planning and Geoinformatics, Finland
More and more computable data related to real estate has been opened in
Finland in recent years. One of the most interesting services is
http://asuntojen.hintatiedot.fi/ which is operated by The Housing Finance and
Development Centre of Finland (ARA). Data in the service is about single
transactions in the Finnish housing market. Approximately one third of the data
contains the information of the energy efficiency class nowadays as well.
In the survey the housing market of Helsinki was studied using data covering the
year 2014 transactions. As a research method linear regression analysis and OLS
estimation were applied to study how the information of the energy performance
certificates EPCs was capitalized into transaction values. Results show that there
are difficulties to estimate shadow prices for each separate EPC class. But
grouping the certificates into bigger entities gave somewhat expected and rational
results.
Research discuss slightly also the data needed in this kind of estimations. In
practical level the transaction based data was enriched by demographic and
socio-economic open data to get reliable shadow prices and unbiased results.
What is interesting to see is that even though energy efficiency is a factor having
a price influence, it is not a search criterion in the biggest Finnish internet housing
brokerage services. As a conclusion it can be said that even though EPCs have
been part of compulsory information in the real estate market several years, the
situation could be almost in its infancy like in the Finnish real estate market which
is anyway quite developed market in many ways.
Keywords: Energy efficiency, energy performance certificate, linear regression,
open data
Paper Number:20 Real Estate Valuation
Q-3
210 ERES 2015 Conference 24-27 June 2015 Istanbul
Housing Rents in Wallonia, Belgium: The Observation
System and Market Segmentation
Marko Kryvobokov, Center for Sustainable Housing Studies (CEHD), Belgium
In the French-speaking Belgian region of Wallonia, one third of households rent
their accommodations. Three thirds of them represent private rental sector. Taking
into account the important size of this sector and recognizing the weakness of the
existing state of data collection, the administration of the Walloon Region has
recently decided to create a system of residential rent observation. The detailed
and updated information about housing attributes and rents should be used in
housing policy revision, including more transparent rent estimation in private rental
sector. The Center for Sustainable Housing Studies is responsible for the
statistical and methodological management of this system.
The first wave of the observation system includes 2,500 face-to-face interviews
among the private renters in the arrondissements of Nivelles and Charleroi. While
the former represents to large degree the rich suburbs of Brussels, the latter is a
mainly urbanized area well-known by its chronical problems of poverty, high crime
rate and low quality of housing. In both arrondissements, it was asked 3.6% of
households renting their accommodation in private sector. Though in hedonic
regression literature the analysis of housing rents is rather rare, it is applied more
and more often in recent years. In our study, a hedonic model of housing rents is
constructed with internal and geographical attributes as explanatory variables.
Neighborhoods are included in the equation as dummies. The aim of the study is
to find which mode of data treatment provides better model performance and out-
of-sample prediction: an overall model with all observations or market segments
at the spatial level of the contrasting arrondissements (or at a lower spatial level).
Spatial and geographically weighted regression methodologies are applied.
Keywords: Wallonia, hedonic model, housing rent, market segmentation, rent
observation
Paper Number:63 Real Estate Valuation
Q-3
ERES 2015 Conference 24-27 June 2015 Istanbul 211
Assessing the Most Suitable Valuation Approaches and
Methodologies for Stratum Title in Malaysia
Sr. Faziah Abd Rasid, National Institute of Valuation (INSPEN), Malaysia
The National Land Code (NLC) was amended in 1990 to enable the state authority
to issue stratum title for underground space. Stratum Title can be separated from
land titles issued for surface land. This is stipulated in Part 5(A) under Section
92A to 92G. According to Section 92G (1), underground land can be used for any
purpose provided approval is obtained from the authority, which is the federal
government.In relation to underground development with many utilities, the
appraisal of real estate related to underground land use involved some unusual
circumstances. Ordinary appraisal concerned with a total bundle of rights referred
to as fee simple interests and it is generally assumed that the use and enjoyment
of real property rights relates to the surface of the land. However, there are several
below-surface uses of land that require a real estate appraisal.In this research
study, it is the intention to look on the legislation issues related with Stratum Title,
to examine the differences exist between Stratum Title and underground
development in other countries. Also to determine the factors that affecting the
stratum interest and to assess and analyses the valuation issues that impact on
Stratum Title and renew possible valuation approaches and methodologies that
could be applied in the Malaysian context.
Keywords: Stratum title, subterranean space, underground development,
valuation methodologies and techniques
Paper Number:107 Real Estate Valuation
Q-3
212 ERES 2015 Conference 24-27 June 2015 Istanbul
Levels and Development of Real Estate Prices in Different
Austrian Regions
Wolfgang Feilmayr, Department of Planning Vienna University of Technology, Austria
After a period of more or less stable real estate prices at the beginning of the 21st
century, the prices have shown a sharp rise since around 2007 especially in
Vienna, the other federal capitals and its surroundings, whereas in the rural areas
in the periphery prices even declined. In this paper special attention is paid to
alpine and touristic regions. The main differences of these compared to the other
regions will be elaborated. Moreover the variables explaining the prices and
developments will be identified. Results will be presented for single family houses
and for owner occupied appartments. The underlying models use nonlinear
hedonic regression methods. The price observations and the attributes of the
single real estates stem from different data bases including purchase and offer
prices. The neighborhood covariates come mainly from the spatial information
system IRIS, which has been developed for all Austrian communities at the
institute of regional science of Vienna University of Technology.
Keywords: Alpine regions, Austria, hedonic models, regional real estate prices
Paper Number:273 Real Estate Valuation
Q-4
ERES 2015 Conference 24-27 June 2015 Istanbul 213
The Effects of Demolition Control Precincts on Property
Values
Peter Elliott, University of Queensland, Australia
Clive Warren, University of Queensland, Australia
Jason Staines, University of Queensland, Australia
As municipal governments continue to implement historic preservation
regulations, it is vitally important to understand the effects on the designated
properties and the housing market. Determining and understanding the impact is
important for property owners, buyers, planning authorities and valuers.
Whilst it is known that historic preservation designation has an effect on property
value, the effects are mixed and unclear. The direction and magnitude of the effect
is dependent on locational factors, regulatory, structural, and housing market
variables. Literature has extensively examined the effects that historic preservation
designation has on the value of residential property in Europe and the United
States. This is the first study conducted in Australia that investigates the economic
effects of Demolition Control Precincts (DCPs). This research examines the
housing market.
The theoretical model draws upon urban planning theory and housing economics
in the context of an Australian housing market, the City of Brisbane. It was
hypothesised that, DCPs reduce the supply of residential vacant land, causing a
degree of scarcity. The demand for residential vacant land in DCPs is inelastic,
creating market segmentation. It was hypothesised that this segmentation results
in residential vacant land in DCPs selling for a premium over comparable vacant
land not located in DCPs.
Results from hedonic price regression models validate the research model and
provide several insights. Key findings are that Brisbane’s residential vacant land
market is segmented, due to a scarcity of vacant land in DCPs. Vacant land within
DCPs exhibits inelasticity of demand. Vacant land located in DCPs sell for a price
premium of 11 percent, over comparable vacant land located outside of a DCP.
Consistent results are found across all locations of Brisbane, including inner and
outer suburbs.
The thesis has procedural and substantive policy implications. Planning
authorities must find an appropriate balance between historical preservation and
urban development. Property valuation of residential vacant land and houses
requires recognition of housing market segmentation and price premia.
Keywords: Demolition control precincts, impacts, property value
Paper Number:288 Real Estate Valuation
Q-4
214 ERES 2015 Conference 24-27 June 2015 Istanbul
The Use of Options Pricing Methods for the Valuation of
the Bare Dominium Value of Property with a Long Term
Land Lease
Douw Boshoff, University of Pretoria, South Africa
The Bare Dominium of a property is the interests that remain after leasehold rights
are removed. These properties are typically characterised by a long term land
lease, which are improved by the land tenant or lease holder from which a sub-
lease income could be received. The right to this sub-lease income will revert to
the land-owner at expiry of the leasehold. Valuers are, however, sceptical to
assign a value to such improvements in the hands of the land-owner, due to
uncertainty of future market changes and the time-frame associated with the
forecast. This study investigates the use of a put-option to create a risk-free
investment, calculated by using an iterative Black-Scholes Model, as an
alternative to traditional discounted cash flow techniques. The advantage of using
options pricing theory is that it includes volatility of the market in the value
calculation. The research is based on a case study involving a number of actual
valuations. The outcome is a proposed model that can value the bare dominium
and assign a risk-adjusted value to the property, thereby calculating the risk
involved for changes in the market volatility, different types of property, risk
structures and lease terms.
Keywords: Bare dominium, black-scholes model, options pricing theory,
property valuation
Paper Number:106 Real Estate Valuation
Q-4
ERES 2015 Conference 24-27 June 2015 Istanbul 215
The Effect of Strategy Alliance on Property Values: A Case
Study of Hotels in Taiwan
Nan-Yu Chu, Department of Land Management, Feng Chia University, Taiwan, R.O.C.
It has been improved that brand could make the price premium and have multiple
benefits. Thus, development of brand is one of most important strategies for real
estate developers or owners. However, it takes time and cost to create.
Alternatively, the strategy alliance seems to be the other approach to build brand.
This paper argues that “Does strategy alliance make the price premium for real
estate?” “What is the effect of cooperation on property values?” Therefore, based
on the theory of brand premium and strategy alliance, this paper is centered on
hotel properties in Taiwan, and uses the case study method to analyze how the
value of hotel is changing after alliance. The empirical result showed that trust and
manager support could maintain the long relationship of cooperation in the
beginning of strategy alliance. Besides, the degree of price premium was
determined by types of alliance. We suggest that the property owners or
developers could use the concept of strategy alliance to create real estate
benefits.
Keywords: Brand premium, property value, strategy alliance
Paper Number:245 Real Estate Valuation
Q-4
216 ERES 2015 Conference 24-27 June 2015 Istanbul
How Authorized Property Appraisers Construe Information
for Valuation of Commercial Properties: A Repertory Grid
Study
Lina Bellman, Mid Sweden University, Sweden
Peter Öhman, Mid Sweden University, Sweden
Purpose – This study describe and analyze authorized property appraisers’
(APAs) thought patterns when commercial properties are valued, and compare
and draw conclusions about their thinking in terms of content, complexity and
homogeneity.
Design/methodology/approach – First, a standard set of elements and constructs
was included in the grid form (used for data collection). Second, the repertory grid
technique and principal component analysis were used to map and analyze the
thought patterns of nearly half (67) of the authorized APAs in Sweden.
Findings - Analysis of the individual grids and the mean grid of all respondents
demonstrated similarities in the APAs construing and revealed relatively
homogeneous thought patterns. Accordingly, the APAs seem encouraged by
general guidelines (such as Swedish Annual property Index valuation guidance),
and by guidelines and ethical rules prepared by the APAs own organization. At
the same time the APAs thought patterns were found to be relatively complex.
They focus on several kinds of information and their assessments are perceived
to effect property valuation on micro and macro levels differently.
Practical implications – Based on the homogeneity in the APA’s thought patterns,
this study discusses if authorized APAs have begun a “legitimacy journey”
towards an upcoming establishment of a profession.
Originality/value – To the auditors knowledge this is the first study using the
repertory grid to map and analyse APA’s thought patterns at an aggregated level.
Keywords: Authorized property appraisers, valuation judgments, commercial
properties, profession, thought patterns, aggregated level, repertory
grid technique, Sweden
Paper Number:16 Tax & Legal Issues in Real Estate
R-8
ERES 2015 Conference 24-27 June 2015 Istanbul 217
Actual Topics within Germanys Housing Policy
Ramón Sotelo, Bauhaus-Universität Weimar, Germany
During the electoral campaign for the general elections held on 22nd September
2013 the lobby group representing the tenants proposed a rent regulation in the
housing sector concerning also new contracts for existing housing beyond social
housing. This proposal was immediately included into their political agenda by the
social democrats (SPD) and very shortly afterwards also taken as a position by
chancellor Merkel as leader of the Cristian Democratic Party (SPD), although
many doubts were expressed within her own party. Only the liberal party opposed
to any type of rent control, but did in the end not enter parliament. After elections
a coalition between the Social Democrats and the Cristian Democratic Parties was
established and the implementation of the rent control fixed. This paper analyses
the political reasons for the behavior of Angela Merkel, looks at the expected
results from this rent control concerning the allocation of flats, the proportion of
home-ownership, the ongoing segregation within cities, and the future
construction of new housing.
Keywords: Germany, housing policy, rent regulation
Paper Number:71 Tax & Legal Issues in Real Estate
R-8
218 ERES 2015 Conference 24-27 June 2015 Istanbul
Development of Refurbishment Concepts – The Case of
Multi-family Houses from the 1970s in Western Germany
Sebastian Johann, University of Kaiserslautern, Germany
The European housing stock is dominated by properties built before the 1980s.
These buildings are to a great extent far behind current technical and social
requirements. This paper develops a supply- and demand-oriented refurbishment
concept for residential buildings, specifically the case of multi-family houses from
the 1970s in Western Germany. About 2.4 million dwellings and more than 13% of
the entire multi-family housing stock in West Germany are located in multi-family
houses from the 1970s, in many cases still without any major refurbishment
measures until now. A large portion of this stock was or will be subject of portfolio
deals often involving foreign investors. Using data from housing corporations,
more than 13,700 energy certificates and expert interviews as well as a secondary
analysis of a representative survey of housing demand in Germany the key
building characteristics and needs for action for this type of the building stock are
identified. Further, the specific requirements of the main target groups are found.
The results show prioritized refurbishment measures including improvements of
thermal insulation (e.g. roof, exterior walls), energy supply, bathrooms, balconies,
house entrance areas as well as the structuring of outdoor facilities. The empirical
results are useful for property owners like housing corporations, municipalities,
owner communities or foreign investors in Western Germany and other European
countries to find fundamental and demand-oriented refurbishment measures for
their buildings.
Keywords: Multi-family houses, obsolescence, refurbishment measures,
residential property building, user requirements
Paper Number:219 Tax & Legal Issues in Real Estate
R-8
ERES 2015 Conference 24-27 June 2015 Istanbul 219
Contemporary Challenges to Statutory Valuation Systems-
The Australian Experience
Mike Hefferan, University of the Sunshine Coast, Australia
Ad valorem assessment of real property represents one of the longest surviving
mechanisms for securing government revenue and still represents an important
component of taxation collections across both developed and developing
countries. Its acceptance and longevity reflects its relative simplicity, rationality
and perceived equity. While these fundamentals remain, the nature and
complexity of many contemporary property assets and the density of
development, particularly in urban areas, present challenges to the statutory
valuation processes. It has been necessary in some jurisdictions to significantly
amend and adapted legislation and practice to accommodate a demonstrably
different economic, community, environmental and political context. This paper
describes the nature of this new environment and how it impacts on the way in
which statutory valuations are performed and are applied. It draws on case study
examples from Australia where in some jurisdictions, quite radical changes have
been necessary to ensure the sustainability of and confidence in these systems.
The paper suggests that there are a number of key characteristics and initiatives
that assists in this evolutionary process though also alerts that there are some
fundamental challenges to this form of assessment and taxation that now need to
be addressed in a comprehensive and strategic way. The work is based on a
literature/legislative study and specific investigations and structured interviews,
drawn principally from examples in Queensland, other Australian States and New
Zealand. A number of findings will be relevant to other jurisdictions that rely, at
least in part, on taxation basis on the assessment of property value.
Keywords: Ad valorem taxation, statutory valuation processes, changes in
property assets, legislative change, Australian property examples
Paper Number:333
PANEL – EPRA
Public Real Estate Invesments; An International Perspective
PAN1
220 ERES 2015 Conference 24-27 June 2015 Istanbul
The Performance Implications of Adding Global Listed
Real Estate to an Unlisted Real Estate Portfolio
Alex Moss, Consilia Capital, UK
It has been established in a previous paper (Moss & Farrelly 2014) that adding a
global listed real estate element (25%-30%) to an unlisted (UK) real estate portfolio
could enhance returns. This paper takes the analysis and understanding of
blended real estate portfolios further, by increasing the geographic range of the
unlisted element, and examining refinements to a straight buy and hold strategy
for the listed element. In particular it seeks to answer the following questions: 1)
Does the strategy work for regions other than the UK? We examine the impact of
combining a global listed element with a direct property allocation from Europe,
Asia and the US, using Transaction Based Indices. 2) Would performance be
improved if different Smart Beta (Alternative Index Weighting) strategies were
employed? If so which strategies (Equal weighting, High/ Low Leverage, etc ) work
best? 3) Is it possible to adopt a rules-based trading strategy that would enhance
performance of the listed element? We look at Momentum based strategies, Trend
Following, and a combination of the two, concluding that these strategies can
have a significant role to play in risk reduction of the listed element of a blended
portfolio.
Paper Number:334
PANEL – EPRA
Public Real Estate Invesments; An International Perspective
PAN1
ERES 2015 Conference 24-27 June 2015 Istanbul 221
Diversification Gains, Sector Exposure and Systematic
Risk in International Public Real Estate Markets
Marielle Chuangdumronsomgsuk, Cambridge Real Estate Research Centre,
Department of Land Economy, University of Cambridge, UK
Colin Lizieri, Cambridge Real Estate Research Centre, Department of Land Economy,
University of Cambridge, UK
Investors increasingly use listed real estate securities to provide international
diversification in their property portfolios. The success of such strategies depends
on differing exposure to risk factors across the range of securities acquired and
on the long run integration (or lack of it) of the returns of real estate firms. However,
real estate investors (particularly those focussed on active management
strategies) often select individual stocks (for example by size) that may not track
published national indices (the basis of much research) and may have sector and
geographical biases (for example, with excess exposure to major cities). As a
result, commonly-held stocks may have a high exposure to global risk factors,
altering risk-adjusted return and diversification relationships. In this paper, we re-
analyse the benefits of holding a portfolio of international real estate securities, by
incorporating evidence of real estate factors, cointegrating relationships and
structural breaks and, specifically, test whether the diversification benefits depend
on how integrated or independent the firms and countries are at global or regional
level and whether more risk reduction can be achieved through holding
internationally diversified investments in markets that are less dominated by global
real estate factors. We examine the portfolio performance and factor sensitivities
of “cointegrated and “independent” groups first at national level and then at
individual sector level and for firms with high exposure to global financial centres.
We assess whether the portfolios differ in terms of risk-adjusted return based on
Sharpe ratios and sensitivity to systematic risk, using a range of multi-factor
models, and decompose portfolio risk using Fama-Macbeth approach testing for
differences in risk sensitivity and volatility. The extent of this global effect helps
inform international investors, particularly in light of a growing integration within
global securities markets. This task is given further significance by the events of
the global financial crisis, where correlation between markets (and asset classes)
appeared to increase rapidly precisely when diversification would have been most
valuable.
Paper Number:81
PANEL – EPRA
Public Real Estate Invesments; An International Perspective
PAN1
222 ERES 2015 Conference 24-27 June 2015 Istanbul
Are Public and Private Real Estate Returns and Risks the
Same?
Martin Hoesli, University of Geneva, Switzerland
Elias Oikarinen, University of Turku, Finland
This article investigates the similarity of public and private real estate returns and
risks over the long horizon using data for the U.S and the U.K. The results show
evidence of a one-to-one relationship between publicly traded REIT performance
and privately traded direct real estate investment performance in three out of four
U.S. real estate sectors and one out of two U.K. sectors. The return volatilities
generally do not differ significantly between the REIT and direct real estate
markets regardless of investment horizon. The findings have important practical
implications. First, they indicate that public and private real estate investments
can be considered to work as good substitutes in an investment portfolio with
several years investment horizon. Second, they suggest that REIT related ETFs
and derivatives could be used to hedge risks caused by investors’ direct real
estate holdings or by lending institutions’ mortgage lending inventory.
Keywords: Hedging, portfolio, REIT, return, risk
Paper Number:223
PANEL – EPRA
Public Real Estate Invesments; An International Perspective
PAN1
ERES 2015 Conference 24-27 June 2015 Istanbul 223
The Impact of Financial Regulations on the European
Listed Real Estate Sector
Martin Hoesli, University of Geneva, Switzerland
Stanimira Milcheva, University of Reading, UK
Alex Moss, Consilia Capital, UK
There are several ongoing changes to the regulations on the financial markets
such as the Alternative Investment Fund Management Directive (AIFMD),
Solvency II and Basel III which will directly or indirectly affect the European real
estate sector. Although the implementation of some of them is still in progress,
the aim of this study is to assess potential outcomes associated with the
regulatory reforms for the listed real estate industry in selected European
countries. Our main focus will be on analysing the impact of regulation on the size
and structure of the listed real estate sector in Europe. There has been almost no
empirical research in this area thus far due to the lack of data and the uncertainty
surrounding the regulatory changes. While the overall impacts are hard to be
determined without awaiting the full implementation of the regulations in the
national legislations, we aim to provide a first assessment of the effects of major
financial market regulations on systematic risk in country real estate returns as
well as on debt and equity issuance in Europe.
Keywords: Financial market regulation, listed real estate, interviews debt and
equity issuance
Paper Number:59
PANEL – MSCI
Globalisation of Real Estate Investment
PAN4
224 ERES 2015 Conference 24-27 June 2015 Istanbul
The Impact of Liquidity on Valuation and Capital Raising
for Global Listed Real Estate Companies
Alex Moss, Consilia Capital, UK
Nicole Lux, Deutsche Bank, UK
In a previous paper we examined the impact of liquidity on the valuation of
European property shares, and determined that not only was there a strong
relationship between liquidity and valuation post GFC but that it also had
significant implications for fund raising and therefore a company’s ability to grow.
In this paper we extend the study to include North American and Asian
companies, thereby allowing for regional differences in the liquidity effect, and
also accounting for local valuation preferences. In addition we also look at the
relationship between the liquidity of a company and the level of equity and debt
issuance pre and post GFC to determine whether there is a relationship.
Keywords: Global REITs, liquidity, valuation
Paper Number:189
PANEL – MSCI
Globalisation of Real Estate Investment
PAN4
ERES 2015 Conference 24-27 June 2015 Istanbul 225
Managing Performance & Risk through Blended Global
Investment Strategies
Mark Clacy-Jones, MSCI / IPD, UK
As real estate investment becomes increasingly global the number of investment
funds with exposure across countries and regions is growing. An emerging trend
is the use of different routes to access real estate returns with portfolios
comprising mixtures of direct real estate, unlisted funds and REITs as well as
derivatives and real estate debt with the added dimension of geographical
dispersion of assets. The benefits and constraints of each type of real estate
exposure will be discussed in the context of a variety of investment strategies,
considering a spectrum of investors and mandates to highlight appropriate
blends of direct real estate, unlisted funds and listed exposure. Using IPD
datasets across more than 30 countries for direct real estate and unlisted real
estate funds, combined with MSCI listed real estate indexes, and IPD size
estimates of national market universes, it is possible to analyse and compare
performance and risk for a number of different investment strategies. Conclusions
can then be drawn on the benefits of blended global strategies over more
conventional approaches to portfolio construction, which are dominated by
domestic, single route strategies.
Keywords: Blended, global, investment, performance, strategy
Paper Number:233
PANEL – MSCI
Globalisation of Real Estate Investment
PAN4
226 ERES 2015 Conference 24-27 June 2015 Istanbul
The Listed Funds’ Real Estate Investment Process:
Linkage between Asset Strategy & Reporting and Investor
Objectives
Bert Teuben, MSCI, The Netherlands
Peter Hobbs, MSCI, UK
Mark Clacy-Jones, MSCI / IPD, UK
During the first quarter of 2015, IPD conducted a survey into the investment
process of listed real estate funds, with a particularly close examination of their
strategy and reporting. This paper provides a detailed analysis of the relationship
between the investor relationship, strategy and asset management, with a
particular focus on investment strategy, transparency & reporting and asset
management.
The results are based on a desk-based analysis of over 100 listed funds, in-person
interviews with over 25 listed funds and a literature review. The focus is on listed
funds in Europe and Asia-Pacific, providing in-depth coverage of these funds
across approximately 10 countries. The research provides a comprehensive
review of the large listed real estate industry of approximately USD 2.5 trillion
(GAV) across the globe, including their different investment styles and their
geographic exposures. The more innovative aspects of the research relate to the
approach of listed funds’ investment process, explaining the potential for
misalignment at various stages of the investment process. This includes
alignment between investor objectives and actual real estate exposures, the
investment styles, and the link between portfolio and asset-specific monitoring
and the investment strategy. The final section of the paper draws out some of the
implications of the research including a categorization of different types of listed
funds and the steps taken by a series of ’global leaders‘ seeking to strengthen the
investment process.
Keywords: Investment styles, listed funds, real estate investment process,
transparency&reporting
Paper Number:256 Doctoral Presentation
PHA1
ERES 2015 Conference 24-27 June 2015 Istanbul 227
Electricity Consumption and House Values
Ignas Gostautas, Nottingham Trent University, Lithuania
The study investigates whether electricity consumption could be a valuable data
supplement in analysing house value variations within the city. Electricity
consumption is a proxy for economic and citizen activity, wealth, population size,
density, and to a certain extent habits of the residents. In general, electricity could
substitute many factors that are essential in real estate markets. The study
investigates real estate market in London by employing a panel of electricity
consumption and house price data of 32 boroughs from 2003 to 2014. The data
enables to examine cross-sectional and temporal links using several panel
models. Additionally, robustness of outcomes are tested. The findings indicate
that there is a negative correlation between domestic electricity consumption and
average house values, suggesting that owners of more expensive houses
consumes less electricity. On the other hand, boroughs that consume more non
domestic electricity are positively related with the average house values in the
area, suggesting that homes are more expensive in more active areas. Electricity
consumption could supplement data used in real estate market analysis. The
electricity consumption data is precise, rapidly obtained, and could be gathered
frequently without high cost, contrary to population and economic activity
statistics. At the same time electricity consumption may help analyse the
characteristics of an area that are difficult to quantify and expensive to collect. To
the authors’ knowledge, there is no other study that investigates interconnection
between electricity consumption and real estate market. By using the electricity
consumption, house price trends could be quantified more precisely, thus
producing a city profile that paints a more realistic picture for the market
participants.
Keywords: London, electricity consumption, house prices, panel
Paper Number:39 Doctoral Presentation
PHA1
228 ERES 2015 Conference 24-27 June 2015 Istanbul
Residential Valuation Systems in the United Arab Emirates
Ebraheim Lahbash, Royal Agricultural University, UK
Simon Huston, Royal Agricultural University, UK
Since 1996, real estate development has transformed the United Arab Emirates
(UAE) into a regional trade and logistics hub. Between January 2003 and
December 2010 Dubai Residential Property Price Index (DRPPI) rose from 100 to
a heady 240 in 2008 and then dropped back to 156.19 by 2010. The value of two
bedroom apartments in the iconic 'Burj Khalif, the world’s tallest building, rose to
$3,811 and fell back down to $762 per per square foot. During the 2008 property
collapse, residential prices in Dubai fell around 50% and by 2010, exhibitors at
Cityscape dropped from 1,000 to 200. Property values in the UAE are exposed to
strategic risks, sentiment, oil price fluctuations and the movement of global capital
into and out of the trading hub. Internally, each emirate has distinct spatial and
evolving sub-markets. Recognising the volatile backdrop and high information
costs, the research seeks to develop a robust residential property valuation
system for the UAE.
Keywords: Capital flows, information asymmetry, residential property, sub-
markets, valuation standards
Paper Number:44 Doctoral Presentation
PHA1
ERES 2015 Conference 24-27 June 2015 Istanbul 229
House Price Appreciation and Housing Affordability: A
Study of Younger Households Tenure Choice in China
Liming Yao, Nottingham Trent University, UK
Michael White, Nottingham Trent University, UK
Alla Koblyakova, Nottingham Trent University, UK
Housing affordability distinguishes ‘need’ and ‘access’ as the key criteria to
examine the ability of the households to enter the housing market or transit into
homeownership. Housing affordability was broadly considered as the relationship
between housing and non-housing expenditures, which examines the ability of
households paying for a house without breaking current living standards or falling
into poverty. In the context of economic transition and housing reform in China a
fully market-oriented housing market has developed. The expansion of the
residential housing market has been accompanied with house price appreciation
and inflation, accelerating urbanization, and a rising demand for housing. These
changes have led to affordability problems, particularly for low and middle-income
groups. Recent research on housing affordability has shifted from estimating
affordability indices to policy debates of granting housing and social welfare
subsidies.
This paper examines the magnitude of Chinese households’ housing affordability
issues since the early 1990s, on the basis of the most common measures of
housing affordability. It combines ratio approach with demographic factors,
household formation and financial constraints in estimation. Tenure choice refers
to households' housing decision under the constraints of financial ability to choose
owner-occupied or live in renting houses. The paper then employs affordability
estimation results and analyses how these impact tenure choice decisions. The
model not only employs aggregate level data from Statistical Yearbook, but also
uses Household Survey data to reflect households’ affordability situations in
China. With respect to the results, this paper tries to propose further policy
measures regarding housing affordability and insufficient housing subsidies.
Keywords: Households, housing affordability, tenure choice
Paper Number:248 Doctoral Presentation
PHA1
230 ERES 2015 Conference 24-27 June 2015 Istanbul
Income Distribution and Housing in Poland between 2004
and 2012
Magdalena Teska, San Vicente del Raspeig, Spain
As performing the major transition reform and joining the European Community
fifteen years later Poland’s economy should be rather observed from the broader
historical perspective, nevertheless as provided by Eurostat data the income
inequality in Poland between 2004 and 2012 decreased by roughly 15%. Thus,
this decrease was a result of redistributive effect of social benefits and taxes. And,
which was the impact of this redistributive effect on housing allocation if the
median equivalised disposal income was higher by roughly 9% for the owners of
dwellings and the ownership rate reached 82% in 2012?
Between 2004 and 2008 the housing market boomed and then slowed down for
the next six years leading to reducing sales volumes and falling prices. On the
other hand, the dwellings’ prices have been rising over the last twenty years driven
by the strong economic growth. The boom indeed was forced by the increased
inflow of investments, mainly due to accession to the European Union, low interest
rates, mortgage financing development and new government programmes. And
although the housing sector was a considerable priority for the communist
government, since then it has been still facing the major problems like: housing
shortage and deficiency of dwellings, decay of building stock, the ownership
structure, demographic and social changes in the context of the building stock
and availability of dwellings, changes in the labour market, the government
housing policy, barriers to the development of the construction industry.
Keywords: Housing market, income distribution, income distribution and
housing
Paper Number:73 Doctoral Presentation
PHA2
ERES 2015 Conference 24-27 June 2015 Istanbul 231
Is Real Estate Private Equity Real Estate?
Randy I. Anderson, Griffin Capital Corporation, Principal, El Segundo, USA
Nico B. Rottke, EBS Universität für Wirtschaft und Recht, Real Estate Investment and
Finance, Germany
Sebastian Krautz, EBS Universität für Wirtschaft und Recht, Germany
In our paper we look at the risk/return characteristics of global real estate private
equity investments and compare them to those of direct real estate and general
private equity investments (i.e. Venture Capital and Buy-out funds).
We investigate if the REPE investments behave more like PE investments than
direct real estate investments. The results obtained in this study allow us to
address a long-lasting debate regarding the way in which these investments
should be called, i.e. REPE or PERE (depending on the individual preference of
which aspect should be more pronounced). We will further whether capital
allocations towards opportunistic REPE investments are in the wrong 'bucket'
when included in the real estate share of the portfolio allocation.
Keywords: Asset allocation, portfolio strategy, real estate investment, real estate
private equity
Paper Number:125 Doctoral Presentation
PHA2
232 ERES 2015 Conference 24-27 June 2015 Istanbul
The Trade-off between Housing and Pensions in the
Household Portfolio of the Eldery
Thomas Müller, EBS Universität für Wirtschaft und Recht EBS Business School Real
Estate Management Institute, Germany
Both household investments in own housing and payments into the pension
system are forms of a life-cycle redistribution process of income from working age
to retirement. They can be seen as a store of wealth that can be released in the
old-age. There is a already well-established theory about a possible trade-off
between both income forms or more generally speaking between home
ownership and the development of the welfare state. This paper adds to the
existing literature by estimating the offset between pension and housing wealth
using cross-sectional data of households in 12 European countries within the
Survey of Health, Ageing and Retirement in Europe (SHARE), a multidisciplinary
panel database that includes data on health, socio-economic status and social
and family networks of more than 85,000 individuals aged 50 or over. We calculate
all measures of wealth including pension wealth at the peak of the households
asset wealth curve to analyze their portfolio composition with a focus on pension
and housing wealth. By applying a simple life-cycle model we find empirical
evidence in favor of the trade-off theory. However we are able to show that the
offset effect varies between countries which is in line with expectations due to
differences in their pension system.
Keywords: Home ownership, household wealth, housing, pension
Paper Number:140 Doctoral Presentation
PHA2
ERES 2015 Conference 24-27 June 2015 Istanbul 233
Toward a Liability Driven Investment Paradigm for DC
Pensions: Implication for Real Estate Allocations
Frank Kwakutse Ametefe, University of Reading, UK
Simon Stevenson, University of Reading, UK
Steven Devaney, University of Reading, UK
The role of real estate in investment portfolios was analysed within an Asset
Liability Management Framework since 2000 (see Chun et al (2000), Craft (2001,
2005), Booth (2002)). It was found that, when liabilities are taken account of, the
diversification role of real estate turns out to be more limited and accounts for the
reduced exposure to this asset as witnessed in the portfolio of most institutional
investors. Brounen et al (2010) highlighted another important issue: the choice of
liability stream. They demonstrated that different definitions of liability result in
different allocations to real estate. They compared results obtained when the
actuarial projected benefit obligations of DB Schemes as used in Chun et al
(2000) to those obtained by using the market value of the projected benefit
obligations. The market values were obtained by accounting for interest rate and
inflation risk.
With the shift from Defined Benefit to Defined Contribution pension structures
across the globe, many feel that there is no need to adopt an ALM approach in
optimisation. However, the global financial crisis which occurred between 2007
and 2008 has brought to the fore the uncertainty of income that pension
contributors, especially those based on defined contribution (DC) formulas.
Pension legislations in some OECD countries require that DC Pension funds
provide a certain minimum on pension contributions. These minimum guarantees
could be absolute or relative. Relative return guarantees are set in relation to a
certain benchmark synthetic investment portfolio or the average performance of
pension funds in the industry. When minimum return guarantees are offered by
companies that sponsor DC Plans, the plan inherently takes on DB features
(OECD, 2012).
In the first part of this study, we examine the long-run relationship between the
various asset classes and our chosen liability benchmarks using correlation
analysis and cointegration techniques. We make use of various minimum return
guarantees and other potential benchmarks as our definition of liabilities: 0%
nominal return; 0% real return (inflation proxies: CPI and RPI), government bond
rate, risk-free rates such as t-bill and repo rates (Sharpe, 1994). In the second part
of our study, we use the dynamic Asset Liability Model of Dempster et al (2002).
As in Brounen et al (2010), results of our study would demonstrate how a change
in definition of liability impacts on the asset allocation decision.
Keywords: Asset allocation, cointegration, liability, pensions, portfolio
Paper Number:207 Doctoral Presentation
PHA2
234 ERES 2015 Conference 24-27 June 2015 Istanbul
The Determinants of Historical Property Market Risk
Premium in the London Office Market
Pau Blasi, Paris Dauphine University, France
Alain Cohen, Finance Department, School of Management (ESG UQAM), Canada
Arnaud Simon, Paris Dauphine University, France
The goal of this paper is to get a better understanding of what are the
determinants of historical property market risk premium in the London office
market, and how these historical risk factors vary through the cycle, therefore
affecting market performances. For this purpose we assembled different data
series covering the Q2 2001 to Q2 2014 period. Using the main drivers of the
economy and both the financial and property market we demonstrate empirically
that the risk premium (defined as the difference between the Office Total Return
and the 10-year Gilt Yield) reacts positively with increases in the net absorption or
prime rents. On the other hand, it reacts negatively with increases in net additions
or average net initial yields.
Keywords: London office market, risk factors, risk premium
Paper Number:258 Doctoral Presentation
PHB1
ERES 2015 Conference 24-27 June 2015 Istanbul 235
The Impact of Energy Performance Certificates on the
Prices of Dwellings
Nurul Hana Adi Maimun, University of Ulster, UK
Jim Berry, University of Ulster, UK
Stanley McGreal, University of Ulster, UK
Michael McCord, University of Ulster, UK
Following the Kyoto Protocol, energy efficiency in the property sector has become
a growing concern and there has been an increasing policy focus on improving
the environmental performance of dwellings. Whilst an emerging body of empirical
research has identified price premiums associated with improved building energy
efficiency, the relationship between energy performance and residential property
remains under-researched, geographically diverse, and inhibited by a paucity of
data. By developing a database and applying a hedonic pricing model, this
research aims to establish whether there is a green premium associated with
dwellings within the Belfast Metropolitan Area. The findings will contribute new
knowledge for policy makers and practitioners in the property sector.
Keywords: Belfast metropolitan area, energy efficiency, hedonic model, housing
market, sustainability
Paper Number:87 Doctoral Presentation
PHB1
236 ERES 2015 Conference 24-27 June 2015 Istanbul
Resolving Value through the Court System
Deborah Miriam Leshinsky, Bond University Australia
The courts are currently ill equipped to assess property valuations. At present
arbiter and unpredictable valuations are being accepted. Current outcomes can
be harmful to litigants and wasteful to society. Judges face the same valuation
uncertainty as the parties themselves. Expert witnesses are always going to be
called by the courts - so the system is in need of a good set of protocols.
Currently judges face conflicts in the system, there is a lack of clarity. In order to
resolve less error, maintain credibility and refrain from bias, property valuers are
required to not deviate from the true value. When statistics are involved it would
involve an accurate estimate of value.
However property valuers are not taught how to resolve value through statistics -
so where is the accuracy in property values in the current judical system?
Keywords: Resolving value through the courts
Paper Number:180 Doctoral Presentation
PHB1
ERES 2015 Conference 24-27 June 2015 Istanbul 237
IPO Underpricing of European Property Companies
Claudia Ascherl, University of Regensburg IREBS International Real Estate Business
School, Germany
Wolfgang Schaefers, University of Regensburg IREBS International Real Estate
Business School, Germany
The widely known phenomenon of “underpricing” is frequently observable during
the IPO process and has been researched extensively. Underpricing refers to the
systematically negative difference between the offer price and the first trading
price in the secondary market, implying that the issuing company collects less
money than would have been possible in a fully efficient market. Whereas
underpricing in the real estate sector is has been investigated in considerable
depth in the USA, Australia and Asia, European studies in this field are scarce.
Yet, the motivation to conduct a pan-European analysis on the underpricing of
property IPOs is twofold. First, as stated above there is, to the best of our
knowledge, no European study about underpricing differences in the real estate
sector. Second, due to a growing number of listed real estate companies in most
European countries, a pan-European study should provide clear evidence of IPO
pricing in Europe. To investigate the underpricing phenomenon in the European
real estate sector, this study uses a pan-European sample of listed property
companies and Real Estate Investment Trusts (REITs). Specifically, our sample
comprises ten REITs and 92 listed property companies over the period 1999-
2014. The study is based on the methodology of Beatty and Ritter (1986)
concerning ex-ante uncertainty, for which we use such proxies as gross proceeds,
offer price, market capitalization at the IPO date and the age of the company at
the issuing date. In addition, we include a dummy variable for the two years before
the financial crisis, in order to take into account the high number of IPOs during
this period. Finally, the study considers whether there is a significant difference
between the initial returns of listed property company and REIT IPOs.
Keywords: IPO, ex-ante uncertainty, listed real estate, pan-European study,
underpricing
Paper Number:196 Doctoral Presentation
PHB1
238 ERES 2015 Conference 24-27 June 2015 Istanbul
Summarizing Doctoral Thesis: Hunt for the Green Value
Ari Laitala, Aalto University, Finland
Nowadays relatively wide body of literature in the field of real estate handles the
value of sustainability – and as a part of it, the value of energy efficiency. Most of
this literature seems to be focusing on the issues of what kind of green value there
possibly exists in the different real estate submarkets. Drivers of the green value
have also been discussed and many factors have been argued like energy
savings, rent premiums, enhanced brand images and decreased risk level.
However, conceptualization of the green value has been discussed less and
connection to value theory has been almost slurred. Hereby, questions like how
subjective and objective nature of green value can be characterized, how they are
interweaved and how subjective value perceptions drive the objective value in the
market are paid less attention.
Empirical part of the research is focusing on the value perceptions of energy
efficiency benefits by different property market actors, like real estate owners and
energy efficiency service providers. Opinions of the real estate valuers related to
market functioning and regularities in this relation are mapped as well. Also the
role of energy efficiency and energy performance certificates in the valuation
practice is studied.
Focus on the study is on commercial property market but also some notifications
related to housing market are done. Research clarifies the elements of green value
and decision making criteria for energy efficiency investments. Finally there is an
attempt to model how green value in conceptual level have an impact on prices.
As a summary paper clarifies the questions of what the green value is, why it is
there and what is the impact mechanism on price. Practical implications of the
results are related to value engineering highlighting investment analysis and
possibly some contributions to enhanced valuation considerations can be
provided as well.
Keywords: Energy efficiency, green value, real estate valuation
Paper Number:274 Doctoral Presentation
PHB2
ERES 2015 Conference 24-27 June 2015 Istanbul 239
Impacts of Abandoned Properties in Conflict Zones
(Geopolitical Brownfields) on Real Estate Development &
Regeneration Possibilities: Case of Cyprus Conflict
Mohsen Shojaee Far, Center of Land Policy and Valuations (CPSV), Polytechnic
University of Catalonia, Spain
Carlos Marmolejo Duarte, Valuation and Land Management Research Centre (CPSV),
UPC University, Spain
Abandoned areas are one of the most fundamental consequences within conflict
zones, where they may appear as buffer zone, militarized areas, and closed or
restricted zones. In this regard there are two complimentary discussions: one
advocates the impacts of conflicts among regional policies and related actions
arisen according to the facts that can produce geopolitically conflict zones, and
the other one advocates the nature and origins of geopolitical conflict zones that
can negatively impact the regional policies. Taking both discussions together as
two dimensions among land management issues in conflict areas, and also
considering conflicts in regional policies and existence of geopolitically conflict
zones, would express a negative impact on any planning proposals for real estate
developments and regeneration possibilities. Therefore this study attempt an
investigation on these two dimensions to demonstrate the complicated realities
associated with geopolitically conflict zones. Case of Cyprus conflict taken as an
evidence to this study, where the rare situation of four decade of ongoing conflict
became part of norm of decision making processes regarding all possible real
estate development and regenerations scenarios. The study takes documentary
and empirical research methods as the main methodological approach for data
collection and analysis, where it particularly uses qualitative analysis in order to
gain insights into the unspoken issues of real estate development difficulties within
an internationally ignored conflict zones such as North Cyprus.
Keywords: Conflict Zones, Cyprus policy, geopolitical brownfields, real estate
proposals, regeneration
Paper Number:41 Doctoral Presentation
PHB2
240 ERES 2015 Conference 24-27 June 2015 Istanbul
Real Estate Contribution Margin System with Hierarchical
Structure Effects a Concept for Real Estate Residential
Companies and Cooperatives
Henri Lüdeke, TU Berlin, Germany
Current rents are determined by the market. They are the result of both supply and
demand. In order to estimate if the own cost situation fits to the market rents and
market sales quota, the real estate companies have to create a reverse rent
calculation with their planned prospective cost situation. Calculations on a Cash
Flow-base don´t have the warranty of fitness for the special purpose of reverse
rent calculation because of the volatile Cash Flow-trends and the inclusion of cash
outflows with investment characteristics. Therefore the aim is to adapt the multi-
stage contribution margin systems, which are state of the art in the industry, for
the use in the residential real estate industry. The contribution margin system has
to be expanded to a statement of changes in contribution margins. There are
variances in ascending powers, which have to be checked in a variance analysis.
These variances are caused in different dimensions of the data models of the
residential real estate companies. The use of an OLAP-System will be helpful for
the classification and interpretation of the variances.
Keywords: Contribution margin system, OLAP-systems, residential real estate
companies, variance analysis, reverse rent calculation
Paper Number:181 Doctoral Presentation
PHB2
ERES 2015 Conference 24-27 June 2015 Istanbul 241
Investigations into the Reasons for Non-normal Real
Estate Returns – Time Matters!
Patrick Krieger, ImmIT – Nürtingen-Geislingen University, Germany
Purpose – Many studies have shown that real estate returns are not normally
distributed. Instead, the returns were found to be leptokurtic and slightly skewed
with fat tails on both ends of the distribution. This specific shape of real estate
distributions complicates tasks such as measuring property risk, forecasting real
estate markets, and optimizing real estate portfolios. Some of the reasons for the
non-normality have been documented, but they cannot fully explain the
distribution curve. In this paper we focus on time-related aspects such as the
maturities of lease contracts and vacancy periods and their effect on real estate
returns. The aim of our research is twofold: (1) providing some new reasons for
non-normal distributions of real estate returns and (2) giving some guidance for
modelling real estate risk.
Design / methodology / approach – A unique data set of lease contracts from a
German residential real estate portfolio is employed. Distributions of contract
maturities and vacancy periods are analysed with distribution fitting routines.
Findings – Contract maturities and vacancy periods are not normally distributed.
These results shed some light on the return distributions in favour of compound
distributions. Additionally a subset of lévy processes is provided for modelling real
estate risk.
Research limitations / implications – Only residential real estate in Germany is
examined. Other sectors and countries are interesting topics for future research.
Originality – This paper may provide evidence in favour of compound distributions
for direct real estate investments. Furthermore, some guidance is provided for
modelling real estate risk. This is valuable for both research and management
practice.
Keywords: Compound distributions, fat-tails, leptokurtosis, non-normality,
residential real estate
Paper Number:212 Doctoral Presentation
PHB2
242 ERES 2015 Conference 24-27 June 2015 Istanbul
Real Estate Investment Risks: The Case of Central and
Eastern Europe
Kateryna Kurylchyk, WU Vienna University of Economics and Business, Austria
International real estate diversification provides significant benefits which are
inevitably associated with considerable risks and costs. This requires a thorough
analysis of options in order to take account of substantial uncertainty and
foreignness implied by international investment per se, as well as the real estate
market risks inherent in foreign countries. These factors are intensified by
economic and political distresses and make real estate investors use more
discretion in their operations abroad.
Similarly, in the face of downturn, market players have become cautious about
investing in Central and Eastern Europe (CEE) and shifted their investments away
from many once booming markets. In other words, the crisis resulted in an
increased perception of risk and a change towards more selective investment
strategies in CEE, with international investors unprepared to take high country
risks even though property risks may be low. Thus relatively more importance is
attached to country risks vs. property specifics and gains when making
investment decisions. This study has been motivated by the perceived shortage
of research on real estate markets and investment decision making factors in
CEE, as well as the need for understanding these aspects in order to ensure
sound investments in the region. It seeks to identify major risks of investing in real
estate, with a particular focus on selected CEE countries. The paper addresses in
the first instance the complexity of country risk as a composite risk and its
components. Further, real estate investment trends and issues in the CEE markets
are discussed, with specific investment risks for the CEE region identified. Finally,
the importance of the factors influencing investment decision making is
discussed, as perceived by international investors in the region.
This research contributes to a better understanding of barriers and risks of
international real estate investment while assisting investors in improving their
perception of opportunities and implications associated with real estate
investments in the CEE region.
Keywords: CEE countries and region, country risk, international investment,
ERES 2015 Conference 24-27 June 2015 Istanbul 243
Keyword Register
accreditation, 170, 176
Ad valorem taxation, 219
adaptive reuse, 40, 116
Adaptive reuse, 3, 64
added value, 11, 18, 103, 134
age-restricted housing, 50
agglomeration economies, 132,
149
Aluation models, 202
anchor effect, 206
anchoring, 4, 49, 186, 207
Anchoring, 4, 204, 206, 207
Anchoring heuristic, 207
ARIMA models, 59
Artificial neural networks, 208
Asset allocation, 229, 231
Asset depreciation, 2
asset management, 4, 7, 224
Asset pricing, 16, 126
behavioral real estate, 147
behavioural finance, 191
Behavioural finance, 187
Behavioural real estate, 70
Benchmarking, 8
bootstrap selection, 124
Brand city, 138
building maintenance, 2
Buildings energy retrofit, 27
Campus, 10, 39, 187, 207
Capital asset pricing model, 180
Carbon emissions, 17, 39
Certification, green buildings, 25
Chain-linking, 99
CMBS, 185
Cognition bias, 156
Commercial office, 3
commercial property, 85, 101, 102,
139, 207, 236
Community real estate, 133
Comparative rent, 142
Compound distributions, 239
concept development, 100
conflict zones, 151, 237
Contagion, 190
conversion, 6, 116, 140
Corporate governance, 194
Credit ratings, 79
Credit risk, 122
CREM organization, 9
Decision strategies, 31
Demolition control precincts, 213
development viability, 101
Discrete choice models, 28
distressed market, 102
distressed property, 14
Diversification benefits, 177
diversity, 57, 76, 145, 153, 157, 169
ecology and real estate, 21
economic convergence, 106
educational vision, 171
EEWH green building labeling
system, 23
electricity consumption, 225
electricity prices, 43
emerging markets, 67, 189
employee productivity, 15
Energy conservation, 20
energy efficiency, 17, 19, 24, 26, 29,
32, 36, 39, 58, 98, 209, 233, 236
Energy efficiency, 209, 236
entropy, 153
ERES, 40, 103, 171
ethical practices, 172
Ethnic mover flows, 145
ex-ante uncertainty, 235
facility management, 1, 36, 41
Facility Management, 1, 11
Fama-French three factor model,
196
farmland, 99
financial analysis, 178
244 ERES 2015 Conference 24-27 June 2015 Istanbul
Financial commitment, 8
financial condition, 154, 198
forecasting, 1, 44, 88, 92, 105, 110,
137, 239
future-proofing, 157, 171
gated communities, 131
Generation Y, 71
geopolitical brownfields, 151, 237
Global capital flows, 76
google data, 92
Google searches, 110
green building, 21, 23, 31, 33, 35
Green building Index, 33
Green buildings, 35
green value, 236
growth management, 46
Hazard models, 195
health and wellbeing, 10
health care, 10, 11
Hedging, 220
hedonic model, 19, 66, 205, 208,
210, 233
hedonic modelling, 90
Hedonic modelling, 69
hedonic models, 58, 66, 114, 212
hedonic pricing, 23, 64, 70, 233
hedonic regression analysis, 66
herd behavior, 188
Herd behaviour models, 182
heritage, 64
house price index, 49
house price indices, 54, 112
House prices, 115
household wealth, 230
housing, 19, 21, 22, 28, 32, 36, 41,
42, 46, 47, 48, 49, 50, 51, 52, 53, 54,
55, 57, 58, 59, 60, 61, 62, 63, 64, 65,
66, 67, 69, 70, 71, 74, 81, 91, 92, 93,
94, 95, 97, 98, 108, 112, 113, 114,
122, 131, 133, 134, 136, 137, 140,
141, 142, 152, 153, 160, 163, 164,
191, 198, 205, 208, 209, 210, 213,
217, 218, 227, 228, 230, 233, 236
housing affordability, 46, 74, 227
Housing affordability, 46, 93, 227
housing associations, 60, 61
housing bubble, 47, 93, 97, 112
Housing bubble, 97
housing bubbles, 93
Housing consumption, 48
housing corporations, 61, 218
housing market prices, 55
housing policy, 141, 142, 210, 217,
228
housing values, 50, 152
Implied volatility, 200
Innovative finance, 155
IPO pricing, 199, 235
income distribution, 228
infill development, 163
information asymmetry, 80, 226
innovation, 33, 41, 135
international competitiveness, 72
internet listing services, 51
knowledge workers, 15
kriging metamodelling, 168
Land assembly, 143
land development, 136, 143
land fragmentation, 143
land supply, 81
land values, 101
LCC, 40
lead-lag relationship, 104
learning environment, 171, 174
leptokurtosis, 239
leverage, 184, 192
listed funds, 224
logit model, 159
loss aversion, 186
Mass appraisal, 203
mean reversion, 89
mixed integer programming, 39
Mixed use developments, 73
mortgage demand, 48
Mortgage finance, 179
multi nominal logit, 57
mutual funds, 197, 201
ERES 2015 Conference 24-27 June 2015 Istanbul 245
NAV discount, 184, 188
noise traders, 184
nominal loss aversion, 113
nonlinear regression, 114
non-parametric spatial models, 52
obsolescence, 3, 40, 218
occupier satisfaction, 12
office buildings, 3, 18, 30
OLAP-systems, 238
online retailing, 83
operations research, 120
optimal reserve price, 56
options pricing theory, 214
ownership change, 117
panel data, 55, 68, 88
pedagogy, 169
pensions, 231
performance, 7, 8, 11, 13, 15, 16,
17, 18, 21, 22, 24, 32, 38, 40, 45, 66,
72, 76, 77, 79, 82, 85, 95, 97, 99,
105, 109, 110, 120, 124, 164, 177,
178, 179, 184, 193, 194, 195, 196,
209, 210, 220, 223, 231, 233, 236
performance, strategy, 223
personality indicators, 109
PMI methodology, 158
polycentrism, 205
portfolio management,, 16, 196
PPP, 13, 36, 127, 159
PREAM models, 7
price premium, 62, 64, 119, 213,
215
price-to-income ratio, 65, 74
pricing strategy, 58, 69
productivity, 11, 13, 15, 120, 160
professional skills, 169
property forecasts, 88
property markets resilience, 148
public debt, 127
public real estate management, 96
rasch measurement model, 30
rationality, 80, 88, 191, 219
real estate bubbles, 94
real estate cycles, 91, 95
real estate education, 169, 170,
173, 174, 176
real estate indicators, 87
real estate marketing, 111
real estate services, 75
real estate stocks, 77
real options, 26
regeneration, 27, 67, 151, 155, 164,
165, 237
regression discontinuity, 19
REIT, 31, 77, 78, 79, 124, 181,
184,188, 194, 196, 197, 199, 201,
220, 222, 223, 235
rent act, 142
rent regulation, 217
repertory grid technique, 216
reputation, 10, 12, 75
resilience, 148, 165
Resolving value, 234
retail hierarchy, 146
retail malls, 20
retail market, 83, 161
reverse mortgage, 45
risk, 3, 13, 28, 53, 61, 80, 82, 86, 87,
93, 108, 119, 121, 123, 124, 125,
126, 128, 150, 156, 157, 165, 177,
179, 180, 183, 184, 193, 195, 196,
197, 198, 200, 201, 214, 220, 223,
229, 231, 232, 236, 239, 240
risk assessment, 61, 123
risk factors, 16, 86, 126, 232
risk measurement, 121, 125
risk premium, 232
senior housing, 45
shopping centers, 5, 120, 161
short-term-rental, 140
single index model, 196
smart beta, 201
smart city, 1
smart grids, 26, 41
smart growth, 137
social housing, 36, 61, 217
social media, 108
social values, 60
spatial analysis, 35, 68, 149
spatial autocorrelation, 52, 58
246 ERES 2015 Conference 24-27 June 2015 Istanbul
spatial dependence, 130
spatial econometrics, 90, 130
spatial imputation, 114
spatial planning, 62, 161
spatial variation, 129
stakeholder analysis, 53
strategy alliance, 215
Stratum title, 211
structural equation modeling, 162
sustainability, 6, 17, 18, 20, 22, 23,
25, 27, 37, 38, 39, 41, 132, 165,
167, 219, 233, 236
sustainable real estate, 17, 25
systematic risk, 16, 126
tenant diversification, 185
time series analysis, 91
transaction based indices, 193
transaction cost theory, 80
transaction frequency, 107
turning points, 92, 104
underground development, 211
underwriting costs, 78
urban parks, 42
urban regeneration, 27, 67, 157,
165, 166
urban renewal, 137, 139, 143
urban transformation, 144, 150
vacancy, 3, 6, 91, 96, 104, 141, 239
variance analysis, 238
virtual reality, 151
volatility transmission, 190
waterfront development, 167
ERES 2015 Conference 24-27 June 2015 Istanbul 247
Author Index
Ab Wahid, Mohd Azhar ......................... 70
Abd Rasid, Sr. Faziah ......................... 211
Abiko, Alex .......................................... 36
Adair, Alastair ............................ 102, 155
Adamušcin, Andrej ............................ 161
Adi Maimun, Nurul Hana .................... 235
Adil, Semih ....................................... 150
Akantziliotou, Calliope........................ 101
Akgün, Aliye Ahu ............................... 131
Akinsomi, Omokolade ................ 192, 197
Alaka, Iheanyi .................................... 160
Albayrak, Ayse Nur ............................. 144
Alhanlioglu, Gulcemal .......................... 66
Alkay, Elif .......................................... 129
Alp, Ali ................................................ 95
Alsasua Pastrana, Ioanna ........................ 1
Ambrose, Brent .................................. 185
AmédéeManesme, Charles Olivier 121 200
Ametefe, Frank Kwakutse .................... 233
Anderson, Randy I. ............................. 231
Andersson, Magnus ........................... 206
Anghel, Ion .................................... 34, 48
Ansari, Nelufer ..................................... 37
Ansary, Nishaan ................................. 197
Appel- Meulenbroek, Rianne ........ 8, 9, 99
Antoniucci, Valentina ........................... 40
Ar, Bilge ............................................ 116
Aranda- Mena, Guillermo ................... 170
Arayici , Yusuf ..................................... 92
Arkesteijn, Monique ............................. 95
Arslanli, Kerem Yavuz........................... 67
Arts, Joep ............................................ 60
Artto, Karlos ........................................ 10
Ascherl, Claudia ................................ 237
Assmann, Dirk ................................... 135
Aydin, Erdal ......................................... 19
Aydin, Olgun ..................................... 168
Baccarin, Alessandro ......................... 184
Bakens, Jessie ................................... 145
Barentsen, Danielle .............................. 63
Barthélémy, Fabrice ........................... 121
Bartsch, Paul ....................................... 97
Batra, Chetna ..................................... 178
Baum, Andrew ..................................... 98
Baxter, James .................................... 170
Bay, Alexandra .................................. 120
Beckers, Pascal ................................. 164
Bélanger, Philippe ............................... 42
Bellman, Lina .................................... 216
Bendová, Martina .............................. 163
Berry, Jim .................... 86, 102, 136, 235
Bienert, Sven ............... 17, 22, 36, 37, 97
Blasi, Pau ......................................... 234
Bohman, Helena ................................ 206
Bonifaci, Pietro .............................. 27,35
Bosak, Alexander ................................. 90
Boshoff, Douw................................... 214
Bougie, Roger ..................................... 68
Brackenie, Pim .................................... 18
Branigan, Clare ........................... 46, 191
Braun, Nicole .................................... 140
Braunschweig, Maria ........................... 13
Brounen, Dirk ...................................... 19
Brunauer, Wolfgang A. ................. 17, 113
Bryant, Lyndall .................................... 45
Buitelaar, Edwin .................................. 61
Buyukduman, Ahmet ......................... 111
Caicedo-Llano, Juliana ...................... 124
Cajias. Marcelo ............................. 22, 37
Camlibel, Mehmet Emre ................ 38, 66
Canesi, Rubina .................................. 123
Castanheira, Paulo ............................ 208
Chadburn, Ana .................................... 15
Che Kasim, Asmma ............................. 33
Chen, Fong-Yao .................................. 23
Chin, Lawrence ................................... 20
Chow, Yuen Leng .............................. 108
Chu, Nan-Yu ..................................... 215
Chuangdumronsomgsuk, Marielle 221
Ciochetti, Brian (Tony)......................... 38
Ciora, Costin .......................... 34, 48, 147
Clacy-Jones, Mark .....................225, 226
Cohen, Alain ..................................... 234
Colucci, Paolo ...........................105, 142
Cooke, Howard ...................................... 8
Copiello, Sergio ............................. 27,35
Coskun, Yener ............................. 96, 196
Crosby, Neil ...................................... 100
D'Alpaos, Chiara ..................... 26, 40, 123
D'Arcy, Eamonn ................................... 74
248 ERES 2015 Conference 24-27 June 2015 Istanbul
Das, Prashant .................................... 109
Daugeliene, Ala ................................. 148
Davis, Peadar ...................................... 32
De Jong, Peter ..................................... 39
De jonge, Hans ...................................... 3
De Vries, Bauke ................................... 99
Dermisi, Sofia ...................................... 81
Des Rosiers, François ........................ 200
Deschermeier, Philipp .......................... 43
Devaney, Steven ................ 100, 195, 233
Dian Prima, Annisa ............................ 194
Dietzel, Marian Alexander ..................... 91
Dimovski, William ................................ 77
Dunning, Richard ................................. 50
Dust, Anja ......................................... 207
Echavarria Ochoa, Juan Camilo ... 153, 205
Elliott, Peter....................................... 213
Ericksen, Mike ..................................... 44
Erol, Isil ............................................ 199
Ertugrul, H. Murat ................................ 96
Esen, Bugra Kagan ............................. 139
Essafi, Yasmine ................................... 54
Evans, Kathleen ................................. 207
Faishal, Muhammad .......................... 192
Falkenbach, Heidi .............................. 128
Farrelly, Kieran .................................. 201
Feilmayr, Wolfgang .................... 113, 212
Filippova, Olga .................................. 119
Florentino, Teresa ................................ 41
Francke, Marc .................................... 112
French, Nick ...................................... 202
Frodsham, Malcolm ........................... 104
Fuerst, Franz ........................................ 24
Fürst, Franz ......................................... 22
Gabrielli, Laura .................................. 202
Ge, Xin Janet ..................................... 114
Gezici Korten, Ferhan ......................... 138
Gibler, Karen ....................................... 49
Glumac, Brano ..................................... 56
Gluszak, Michal ................................. 159
Gokbayrak, Ayse ................................ 150
Gostautas, Ignas ................................ 227
Grebenuk, Elena................................... 94
Grégoire, Philippe .............................. 200
Gu, Guowei.......................................... 80
Guloglu, Bulent.................................... 51
Hahn, Jonas ........................................ 97
Hamilton, Ian ....................................... 28
Hannum, Christopher ........................... 67
Haran, Martin ....................................... 32
Haurin, Donald .................................... 44
Hefferan, Mike................................... 219
Heinen, Andréas ................................ 122
Heinrich, Michael .............................. 188
Heitel, Stephanie ................................. 52
Hepsen, Ali ....................................... 168
Hiironen, Juhana ............................... 209
Hobbs, Peter ..................................... 226
Hoebeeck, Annelies ............................. 47
Hoesli, Martin ............................222, 223
Horváth, Áron .................................... 103
Hsiu-yin, Ding................................... 143
Huibers, Fred .................................... 204
Hummel, David ................................. 107
Hussin, Khadijah ................................. 33
Huston, Simon ....... 71, 98, 137, 165, 228
Hutchison, Norman ........................... 155
Jackson, Cath ................................... 157
Jadevicius, Arvydas ..................... 98, 181
Janssen, Ingrid .................................... 68
Johann, Sebastian ............................. 218
Jones, Colin...................................... 146
Juárez, Francisco ................................ 58
Kahre, Kristian ..................................... 73
Kallakmaa, Angelika ............................ 62
Kangalli Uyar, Guler, Sinem ................ 51
Karaca, Melike .................................. 131
Karmagianni, Maria ............................. 28
Kashyap, Anil .............................136, 172
Kask, Kaia ..................................2, 7, 180
Katyoka, Mutale ................................. 125
Kaufmann, Philipp ............................... 25
Kavarnou, Dimitra ................................ 65
Kaya, Merve ...................................... 138
Kemp, Lloyd ..................................... 197
Kesdogan, Dogan ................................ 97
Keskin, Mustafa Çaghan..................... 115
Keskin, Berna .................................... 129
Kestel, Sevtap ................................... 196
Kim, Mi Lim ...................................... 122
Kim, Kyung-Min .................................. 85
Kippes, Stephan .................................. 21
Koblyakova, Alla ................................ 229
Kochetkov, Yuriy ................................. 94
Kok, Nils ............................................. 19
Kolbre, Ene ......................................... 73
Kootstra, Dirk .................................... 134
Koppels, Philip ................................... 63
Krautz, Sebastian ............................... 231
Krieger, Patrick ..........................187, 241
ERES 2015 Conference 24-27 June 2015 Istanbul 249
Kryvobokov, Marko ............................ 210
Kulikauskas, Darius .............................. 64
Kurtbegu, Enareta .............................. 124
Kurylchyk, Kateryna ............................ 242
Kvedaraviciene, Leva .............................. 5
Kyrö, Riikka ......................................... 10
Lahbash, Ebraheim ............................ 228
Laitala, Ari ................................. 209, 238
Landau, Friederike ............................. 141
Lang, Stephan ................................... 126
Lausberg, Carsten .................. 4, 187, 207
Lavasani, Hossein .............................. 169
Le Roux, Pieter ............................ 18, 171
Lee, Stephen ............................. 181, 182
Leshinsky, Deborah Miriam ................ 236
Levent, Mehmet Akif .......................... 150
Levy, Deborah ..................................... 50
Li, Puying ............................................ 71
Liang, Jen-Hsu .................................... 23
Liu, Nan .............................................. 57
Livingstone, Nicola ...................... 82, 146
Lizieri, Colin ................................ 75, 221
Lo, Daniel Y.F. ..................................... 57
Lown, Keith ......................................... 88
Lüdeke, Henri .................................... 240
Lundgren, Berndt ............................... 162
Lux, Nicole ........................................ 224
MacFarlane, John .............................. 203
Maier, Gunther ......................... 25, 34, 48
Mändle, Markus ................................. 107
Marella, Giuliano ................................ 40
Mark, Kantšukov ................................ 180
Marmolejo D., Carlos 1,151,153,205, 239
Marola, Bogdan ................................... 53
Martens, Bob ............................. 102, 174
Masilela, Boitumelo ........................... 197
Matovu, Augustine ............................. 179
McAllister, Pat ..................................... 24
McCord, Michael ......................... 32, 235
McCord, John ...................................... 32
McFarland, Margaret .......................... 169
McGough, Tony ................................... 86
McGreal, Stanley ............... 102, 155, 235
McIlhatton, David ............................... 102
Megat Abdul Rahman, M. Ghazali ... 30, 33
Mekic, Daniel ...................................... 75
Meyer, Kevin ............................... 13, 156
Michael, Lynne .................................. 132
Milcheva, Stanimira ........................... 223
Mirembe, Rachael Daisy .................... 179
Mitrakos, Theodore............................ 101
Mohd Raid, Maryanti ........................... 33
Moretto, Michele ................................. 26
Morri, Giacomo ................................. 184
Morris, Alexandra ................................ 31
Moss, Alex ......... 193, 201, 220, 223, 224
Moulton, Stephanie ............................. 44
Mouzakis, Fotis ................................... 87
Müller, Nikolas D. ............................... 29
Müller, Claus .................................... 141
Müller, Thomas ................................. 232
Multescu, Gheorghe Petru ........... 14, 148
Nalepka, Adam .................................. 127
Nanda, Anupam............................. 24, 65
Nase, Ilir ........................................... 130
Newell, Graeme .................. 177, 189, 192
Nkote, Isaac Nabeta ........................... 179
Nnametu, Jovita ................................ 160
Nurick, Saul ........................................ 31
Öhman, Peter .................................... 216
Oikarinen, Elias ................................. 222
Okoronkwo, Derek Fidelis Chikezie ..... 160
Ong, Seow Eng ..........................108, 192
Organ, Samantha ............................... 155
Orr, Allison ....................................... 157
Orth, Ayosha ....................................... 79
Ostroumoff, Charles........................... 104
Palm, Peter ....................................... 206
Papastamos, Dimitrios ......................... 87
Parker, David .................................... 183
Parlasca, Peter .................................... 53
Parsa, Ali ........................... 165, 166, 167
Peltokorpi, Antti .................................. 10
Pfnür, Andreas ................. 13, 29, 52, 156
Piepke, Franziska................................... 4
Pillen, Koen ........................................ 68
Pitros, Charalambos ............................ 92
Ploegmakers, Huub ........................... 164
Ploumen, Thijs ...................................... 9
Postila, Mikael .................................. 209
Pryce, Gwilym B ................................ 145
Qiulin, Ke.................................... 84, 106
Rahimzad, Reyhaneh ......................... 165
Rebitzer, Dieter .................. 105, 142, 176
Remøy, Hilde ......................... 3, 6, 63, 95
Renz, Mark .................................105, 142
Révész, Gábor ................................... 103
Richardson, Matthew ......................... 186
Robson, Kathryn ................................ 170
Rochdi, Karim ..................................... 16
250 ERES 2015 Conference 24-27 June 2015 Istanbul
Rodriguez, Ramiro J. ............................ 89
Romme, Sjoerd ................................... 99
Rothballer, Christoph ......................... 126
Rottke, Nico B.................................... 231
Roulac, Stephen .................... 74, 83, 175
Ryan, Paul ................................... 46, 191
Ryan, Stephen ................................... 186
Sah, Vivek ........................................... 78
Salzman, Diego ................................... 69
Sander, Priit ...................................... 180
Sanderson, Danielle Claire ................... 12
Santovito, Rogerio ............................... 36
Schaefers, Wolfgang .................. 126, 237
Schäfer, Philipp ................................. 140
Schier, Michael ................................... 93
Schilder, Frans .................................... 61
Schmid, Marcel ................................. 207
Schnejdar, Sebastian ......................... 188
Schofield, Jody.................................... 31
Scofield, David .................................. 195
Sedlacek, Sabine ................................. 25
Semiz, Nisa ....................................... 117
Sengil, Ayse Tugba ............................ 118
Seven, Unal ......................................... 96
Shafer, Michael ................................. 185
Shi, Wei .............................................. 44
Shirina, Saumya ................................ 172
Shojaee Far, Mohsen ............. 1, 151, 239
Shojaei, Leila .................................... 167
Sieracki, Karen ............................ 84, 106
Simon, Arnaud............................. 54, 234
Sittler, Peter ................................ 90, 110
Smeets, Jos .......................................... 9
Smith, Judy ......................................... 15
Smolders, Carine ................................. 47
Sotelo, Ramón ................................... 217
Squires, Graham ................................ 155
Staines, Jason ................................... 213
Stevenson, Simon55,87,125,190,194,233
Stiller, Johannes ................................ 135
Surmann, Markus................................. 17
Symonds, Barry ................................... 14
Taltavull de La Paz, Paloma .................. 58
Telega, Agnieszka .............................. 127
Teska, Magdalena .............................. 230
Teuben, Bert ...................................... 226
Thanos, Sotirios ................................... 28
Thomson, Bob ................................... 174
Tidwell, Alan ....................................... 78
Tirtiroglu, Dogan ............................... 199
Tjeerdsma, A. (Annette) ..................... 133
Toivonen, Saija ................................. 163
Topcu, Mehmet ................................. 152
Tsolacos, Sotiris ................................. 85
Türgen, Nurbanu ............................... 158
Tyvimaa, Tanja .................................... 49
Ugurlu, Deniz ...................................... 66
Valdesogo, Alfonso ........................... 122
Valtonen, Eero ................................... 128
Van der Krabben, Erwin ................ 60, 128
Van der Voordt, Theo ........................... 11
Van der Werf, Ytzen ........................... 204
Van Oel, Clarine .................................. 95
Vatandas, Orhan ................................ 168
Veuger, Ing. Jan ................... 59, 133, 134
Vieira Gomes, Sandra .......................... 41
Viitanen, Kauko ..........................128, 209
Viruly, Francois ........................... 72, 207
Vlachostergiou, Vassiliki .................... 101
Vogt, Gisela ...................................... 176
Voigtländer, Michael ........................... 93
Vos, Daniël ......................................... 95
Warren, Clive .................................... 213
Watkins, Craig ............................. 50, 129
Weberndorfer, Ronald S. .................... 113
Wegrzyn, Joanna ........................127, 159
Weijs- Perrée, Minou .......................... 99
Wellner, Kristin ................................. 141
White, Michael ....................... 84, 88, 229
Wilkinson, Sara ............................... 6, 82
Williams, Brendan ............................. 114
Wissink, Thomas, P. ............................ 56
Wolski, Rafal ..............................154, 198
Woltering, Rene-Ojas .......................... 76
Wurstbauer, Daniel ............................ 126
Wyatt, Peter ................................ 24, 100
Yang Wallentin, Fan ........................... 162
Yao, Liming ...................................... 229
Yayla, Nihal ......................................... 51
Yildirim, Yildiray................................ 185
Yilmaz, Bilgi...................................... 196
Yop, Mohd Haris ............................... 173
Young, James ..................................... 55
Yuo, Tony Shun-Te You ..................... 149
Zahirovic-Herbert, Velma ..................... 49
Zaleczna, Magdalena ......................... 154
Zanjiri, Yasser ................................... 166
Poli
ERES 2015 Conference 24-27 June 2015 Istanbul 251
6146497897559
ISBN 978-975-561-464-9